Problem:
Sadik Inc.'s bonds currently sell for $1,270 and have a par value of $1,000. They pay a $105 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,100.
Required:
Question: What is their yield to call (YTC)?
- 6.89%
- 5.89%
- 5.18%
- 6.54%
- 6.30%
Note: Please provide reasons to support your answer.