Auto Industrial Corporation issues zero coupon bonds at a price of $378 per bond and the face value of $1,000. These are callable in 7 years at a call price of $1050. What is the yield to call for these bonds?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
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Auto Industrial Corporation issues zero coupon bonds at a price of $378 per bond and the face value of $1,000. These are callable in 7 years at a call price of $1050. What is the yield to call for these bonds?
 
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