25

Keenan Industries has a bond outstanding with 15 years to maturity, an 8.25% nominal coupon, semiannual payments, and a $1,000 par value. The bond has a 6.50% nominal yield to maturity, but it can be called in 6 years at a price of $1,045. What is the bond's nominal yield to call? Do not round your intermediate calculations.

a. 2.80%

b. 5.59%

c. 5.81%

d. 5.21%

e. 3.77%