Last year carson industries issued a 10-year, 12% semiannual coupon bond at its par value of $1,000. currently, the bond can be called in 6 years at a price of $1,060 and it sells for $1,200. what are the bond's nominal yield to maturity and its nominal yield to call? do not round intermediate calculations. round your answers to two decimal places.

YTM = 8.93%

YTC = 8.47%

Explanation:

The first part is the present value of the coupon payment until the bond is called.

The second is the present value of the called amount

P = market price value = 1,200

C = annual coupon payment = 1,000 x 12% 120

C/2 = 60

CP = called value = 1,060

t = time = 6 years

Using Financial calculator we get the YTC

8.467835879%

The first part is the present value of the coupon payment until manurity

The second is the present value of the redeem value at maturity

P = market price value = 1,200

C = coupon payment = 1,000 x 12%/2 = 60

C/2 = 60

F = face value = 1,060

t = time = 10 years

Using Financial calculator we get the YTM

8.9337714%

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