Answer:
The YTM is less than 10%
Explanation:
If a coupon rate of a bond is greater than its yield to maturity (YTM), the bond is said to trade at a premium. The Bond's current price would be greater than its Face value
If a coupon rate of a bond is less than its yield to maturity (YTM), the bond is said to trade at a discount. The bonds current price would be less than its face value
In this Question, the bond's current price ($1,197.93) is greater than its face
($1,000) which means that the bond is trading at a premium. Therefore, we can conclude that the bond's YTM is less than its coupon payment. In this question the coupon rate is 10%, therefore the YTM should be less than 10%.
