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Five years ago, a company issued a corporate bond that has a yield of 7% per annum paid semiannually. The face value of the bonds...

Five years ago, a company issued a corporate bond that has a yield of 7% per annum paid semiannually. The face value of the bonds is 10000 with a maturity period of 10 years. This bond can only be converted into 200 shares. If the bond was called, what is the call premium

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Dana
The call premium of the bond is equal to the 1 year interest on the bond
7%*10000=700
The call premium is 700 shillings

Dana05 answered the question on July 15, 2019 at 15:08

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