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​A(n)11.0​%, ​25-year bond has a par value of​ $1,000 and a call price of $1,150. ​(The...

​A(n)11.0​%, ​25-year bond has a par value of​ $1,000 and a call price of $1,150.

​(The bond's first call date is in 5​ years.) Coupon payments are made semiannually​ (so use semiannual compounding where​ appropriate).

a. Find the current​ yield, YTM, and YTC on this​ issue, given that it is currently being priced in the market at $1,275.

Which of these 3 yields is the​ highest? Which is the​ lowest? Which yield would you use to value this​ bond? Explain.

b. Repeat the 3 calculations​ above, given that the bond is being priced at $925.

Now which yield is the​ highest? Which is the​ lowest? Which yield would you use to value this​ bond? Explain.

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