5. Yield to call Six years ago, the Singleton Company issued 20-year bonds with a 14 percent annual coupon rate at their $1,000 par value. The bonds had a 9 percent call premium, with 5
years of call protection. Today, Singleton called the bonds. Compute the realized rate of return
for an investor who purchased the bonds when they were issued and held them until they were
called. Explain why the investor should or should not be happy that Singleton called them.