EXERCISE \#5: A 5-year 6\% annual coupon bond yields 4%. The bond is callable two years at 102. What is the yield to call? Solve the problem in stages. 1. Compute the price of the bond first. Assume face =$1000. P0= 2. Draw the picture of the bond's cash flows assuming it will be called in one year and compute the yield to call. 3. Draw the picture of the bond's cash flows assuming it will be called in two years and compute the yield to call. i= %