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Question : A 2.60 percent coupon municipal bond has 10 years left : 1281

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.)

Current yield _______%

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 bond’s current yield. (Round your answer to 2 decimal places.) |

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Solution
5 (1 Ratings )

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