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1 what is the bonds yield to call ytc 2 if you bought this

Suppose a 10-year, 10 percent, semi annual coupon bond with a par value of $1000 is currently selling for $1,135.90, producing a yield to maturity (YTM) of 8 percent. However, the bond can be called after 5 years for a price of $1,025.

1. What is the bond's yield to call (YTC)?

2. If you bought this bond, do you think you would be more likely to earn the YTM or the YTC? Why?

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Finance Basics: 1 what is the bonds yield to call ytc 2 if you bought this

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