Yield to call represents the rate of return that investors earn if they buy a callable bond at a specific price and hold it until it is called back and they receive the call price, which would be set above the bond's par value.

Question

Quizplus · Accepted Answer

Yield to call is the rate of return that investors would receive if they buy a callable bond at a specific price and hold it until it is called back, and they receive the call price, which is typically above the bond's par value. Therefore, the statement is true.

Yield to Call Represents the Rate of Return That Investors