Yield to Call on a Bond with a Coupon Rate

question 95

Multiple Choice

Yield to call on a bond with a coupon rate of 8% paid semi-annually, 10 years to maturity, a par value of $1,000 and a selling price of $1,071, callable after 5 years at $1,010 is

• A) 3.5%.
• B) 6.49%.
• C) 7.0%.
• D) 8.16%.