Atlantis Fisheries issues zero coupon bonds on the market at a price of $489 per bond. These are callable in 6 years at a call price of $580. Using semiannual compounding, what is the yield to call for these bonds? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

Question

Business

Kylan Bridges

19 August, 18:22

Atlantis Fisheries issues zero coupon bonds on the market at a price of $489 per bond. These are callable in 6 years at a call price of $580. Using semiannual compounding, what is the yield to call for these bonds? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

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Answers (1)

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Carlo Mercer · Answer 1

the yield to call for these bonds is 5.7705 %

Explanation:

In this question, we are required to find the yield to call on the bonds

The Information we have is as follows:

PV = 489

PMT = 0

FV = $580

N = 6

P/YR = 2 (semiannual compounding)

YTC = ?

Using a Financial Calculator and inputting the appropriate values as above, the yield to call is 5.7705 %