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Question 2 DDS Sdn. Bhd. issues a callable (at par) five-year, 7% coupon bond with annual coupon payments. The bond can be called at par

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Question 2 DDS Sdn. Bhd. issues a callable (at par) five-year, 7% coupon bond with annual coupon payments. The bond can be called at par in one year after release or any time after that on a coupon payment date. On release, it has a price of RM110 per RM100 of face value. What is the yield to worst of this bond when it is released? (10 marks)

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