A 20-year, $4000 par value bond has 8% semiannual coupons and matures at par. In addition, the bond is callable at the end of the 10ththrough the 15th years at 105% of par.
a) Find the price to yield 6% convertible semi-annually.
Price when called: ?
Price at maturity: ?
Price the investor should pay: ?
b) Find the price to yield 10% convertible semi-annually.
Price when called: ?
Price at maturity: ?
Price the investor should pay: ?