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Questions 14 - 16 utilize related information A Wicker Park Corporation bond, which has a...

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Questions 14 - 16 utilize related information A Wicker Park Corporation bond, which has a $1,000 par value and 5.4% stated annual coupon interest rate (with interest payments received semiannually currently sells for a price of $972.75. The bond was issued three years ago with a 35 year original maturity, but it can be called by the issuing firm as early as ten years after the original sur date of the bond is called the holder receives a premium of 554. In addition to the par value at the call date. QUESTION PLEASE REFER TO THE ATTACHMENT TO QUESTION 14 IN ANSWERING. Which of the five equations shown would you use in computing the bond holder's IELD TO MATURITY? 70 70 EQUATION 1: $972.75 -- S54.00 $1,000.00 7 1+1 32 EQUATION 2: $1,972.75 = $27.00 + $1,000.00 r =) (*) 64 EQUATION 3: $972.75 = $27.00 + $1,000.00 G) 70 70 EQUATION 4: $1,000.00 - $27.00 $972.75 G+) r EQUATION 5: 64 $972.75 - $27.00 (44) $1,054.00 054.00(+)

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