Suppose that you have a bond that is currently trading for


Suppose that you have a bond that is currently trading for 1,234.56, has just paid its coupon, has a time-to-maturity of   14 years, has an annual coupon rate of 7.1%, and a face value of $1,000. This bond is unique in that the issuing firm has the right, but not obligation to call the bond in 10 years with a 14% call premium. What is this bond's yield-to-call?

a. 4.10%

b. 4.61%

c. 4.77%

d. 5.15%

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Financial Management: Suppose that you have a bond that is currently trading for
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