Quoted annual yield-to-call for these bonds


Problem:

ABC Inc. has just issued bonds with 9% semi-annual coupon rate and 11.5% yield to maturity and will mature at 11 years. The bonds are currently selling for $846.15. The bonds may be called in 3 years at $1045.

Required:

Question: What is the quoted annual yield-to-call for these bonds?

Note: Show all workings.

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Finance Basics: Quoted annual yield-to-call for these bonds
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