A firm's bonds have a maturity of 14 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 7 yea

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A firm's bonds have a maturity of 14 years with a $1,000 facevalue, have an 8% semiannual coupon, are callable in 7 years at$1,063.19, and currently sell at a price of $1,119.04. What aretheir nominal yield to maturity and their nominal yield to call? Donot round intermediate calculations.
Round your answers to two decimal places.
YTM: %
YTC: %
What return should investors expect to earn on these bonds?
I. Investors would expect the bonds to be called and to earn theYTC because the YTC is greater than the YTM.
II. Investors would not expect the bonds to be called and toearn the YTM because the YTM is greater than the YTC.
III. Investors would not expect the bonds to be called and toearn the YTM because the YTM is less than the YTC.
IV. Investors would expect the bonds to be called and to earnthe YTC because the YTC is less than the YTM.