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General Electric has just issued a callable​ (at par)​ 10-year, 5.7 % coupon bond with annual...

General Electric has just issued a callable​ (at par)​ 10-year, 5.7 % coupon bond with annual coupon payments. The bond can be called at par in one year or anytime thereafter on a coupon payment date. It has a price of $ 102.18.

a. What is the​ bond's yield to​ maturity?

b. What is its yield to​ call?

c. What is its yield to​ worst?

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Answer #1

ANSWER IN THE IMAGE((YELLOW HIGHLIGHTED). FEEL FREE TO ASK ANY DOUBTS. THUMBS UP PLEASE.

A.

b.

since bond can be called any time after year 1, its no.of years is taken as 1.

C.

since it will have worst yiels if its called at year 1 and then the yield increases as time increases.

its ytw=3.44%

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