Attempts Average / 4 22. Problem 4-22 (Yield to Maturity and Vield to Call) eBook Yield to Maturity and Yield to Call Amot Intemational's bonds have a current market price of $1,250. The bonds have a 10% annual coupon payment, a $1,000 face value, and 10 years eft until maturity. The bonds may be called in 5 years at 109% of face value (call price - 1,090) a. What is the yield to maturity? Round your answer to two decimal places. b. What is the yield to cal if they are called in 5 years? Round your answer to two decimal places c. Which yield might investors expect to ear on these bonds, and why? -Select- 1. Investors would expect the bonds to be called and to eam the YTC because the YTC is less than the YTM. II. Investors would expect the bonds to be called and to eam the YTC because the YTM is less than the YTC. 111. Investors would not expect the bonds to be called and to eam the YTM because the YTM is greater than the YTC IV. Investors would not expect the bonds to be called and to eam the YTM because the YTM is less than the YTC. d. The bond's indenture indicates that the cal provision gives the firm the night to call them at the end of each year beginning in Year 5. In Year 5, they may be called at 109% of face value, but in each of the next 4 years the call percentage will decline by 1 percentage point. Thus, in Year 6 they may be called at 108% of face value, in Year 7 they may be caled at 107 of face value, and so on. If the wild curve is honzontal and interest rates remain at their current level, when is the latest that investors might expect the firm to call the bonds? -Select