Mattco has 9% annual coupon, $1,000 face value bonds outstanding that mature in 10 years. However, the bonds can be called before maturity at a call price of $1,050. The bonds have a yield to call of 6.5% and a yield to maturity of 7.4%. How long until these bonds may first be called?© BrainMass Inc. brainmass.com June 3, 2020, 10:17 pm ad1c9bdddf
Please refer attached file for better clarity of tables and formulas.
n = number of periods =10years
Coupon payment =1000*9%=90 dollar
You can use Present value of $1 annuity tables for n=10 and r= 7.4% to ...
The solution describes the steps for calculating minimum time when the bond can be called at given call price.