A customer buys an 8% bond on an 8.20 basis. If the bond is callable in 5 years at par and matures in 10 years, which of the following statements is TRUE?
A) YTC is lower than YTM.
B) Nominal yield is higher than YTM.
C) Nominal yield is higher than YTC.
D) YTC is higher than YTM.
Answer: D) YTC is higher than YTM.