Question:
Assume you purchassed an 8 percent, 20-year, $1,000 par, semiannual payment bond priced at $1012.50 when it has 12 years remaining until maturity. Compute its promised yield to maturity and its yield to call if the bond is callable in three years with an 8 percent premium.
For the promised yield to maturity, does n = 24 or 40? Please explain and calculate.