A 2.60 percent coupon municipal bond has 10 years left

jagguarpaw February 1, 2017 0 Comments

A 2.60 percent coupon municipal bond has 10 years left to maturity and has a price quote of 95.25. The bond can be called in four 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. (Round your answer to 2 decimal places.)
Current yield   _______%

Compute the yield to maturity. (Round your answer to 2 decimal places.)
Yield to maturity__________

Compute the taxable equivalent yield (for an investor in the 30 percent marginal tax bracket). (Round your answer to 2 decimal places.)

Equivalent taxable yied_______%

Compute the yield to call. (Round your answer to 2 decimal places.)
Yield to call_________ %