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A 15-year callable bond is currently issued at market interest rate of 7.67%. Annual coupon rate...

A 15-year callable bond is currently issued at market interest rate of 7.67%. Annual coupon rate is 10.5%.

The callable bond will be called in 4 years at $1,100.

What is YTC? (Assuming the bond is semi-annually compounding.)

1. 13.15%

2. 8.12%

3. 6.32%

4. 10.50%

5. 5.69%

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