A bond's current price is $650. The bond has a face value of $1000, a coupon rate of 5%, maturity in 1.5 years, and it pays coupons semi-annually. Investors expect that the firm will be able to meet its coupon obligations, but they calculate the probability of default on the face value at maturity to be 30%.

What is the bond's annualized expected yield?

20.03%

44.38%

37.61%

12.51%