What is holding period yield

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A 20-year U.S. corporate bond sold to investors at a price of $975 with a 10 percent coupon rate is called 11 years later at an eleven percent call premium. At the time of call, prevailing rates on comparable securities were 6 percent. If the bond's holder reinvested the call price at 6 percent for 9 years, what is his 20-year holding period yield? Show your work below.

Reference no: EM131556037

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