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YTM/YTP

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You just bought a 10 year bond with 5% annual coupon, payable semiannually, on $1,000 par for $1,025. The bond has put provisions that the issuing firm should retire bonds for $950 per bond if the YTM rises to 7% or higher in three years. Compute the yield-to-maturity (YTM) and the yield-to-put (YTP) of your investment.

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Solution Summary

The solution explains the calculation of yield-to-maturity (YTM) and the yield-to-put (YTP).

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