A bond's call feature may be exercised if
1) the yield to maturity exceeds the current yield
2) the yield to maturity is less than the current
Yield
3) interest rates have risen
4) interest rates have fallen

Question

Quizplus · Accepted Answer

A bond's call feature is typically exercised when interest rates have fallen, allowing the issuer to refinance at a lower rate. When interest rates fall, the yield to maturity is less than the current yield.

A Bond's Call Feature May Be Exercised If