A 3.60 percent coupon municipal bond has 14 years left to maturity and has a price...

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A 3.60 percent coupon municipal bond has 14 years left tomaturity and has a price quote of 95.45. The bond can be called infour years. The call premium is one year of coupon payments.(Assume interest payments are semiannual and a par value of$5,000.)
Compute the bond’s current yield. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)
Compute the yield to maturity. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)
Compute the taxable equivalent yield (for an investor in the 36percent marginal tax bracket). (Do not round intermediatecalculations. Round your answer to 2 decimal places.)
Compute the yield to call. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)

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3.9 Ratings (732 Votes)

Coupon Rate 36 payable semiannually Par Value 5000 Remaining Tenure 14 years or 14 x 2 28 halfyears Price Quoute 9545 of Par Value Market Price 09545 x 5000 47725 SemiAnnual Coupon 0036 x See Answer

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A 3.60 percent coupon municipal bond has 14 years left tomaturity and has a price quote of 95.45. The bond can be called infour years. The call premium is one year of coupon payments.(Assume interest payments are semiannual and a par value of$5,000.)Compute the bond’s current yield. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)Compute the yield to maturity. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)Compute the taxable equivalent yield (for an investor in the 36percent marginal tax bracket). (Do not round intermediatecalculations. Round your answer to 2 decimal places.)Compute the yield to call. (Do not round intermediatecalculations. Round your answer to 2 decimal places.)