Explain the differences between yield-to-maturity and yield-to-call

What will be an ideal response?

Answer: The yield-to-maturity is based on holding a bond until it matures at which time the face value is paid. The yield-to-call is based on holding a bond until the first date at which the bond is freely callable at which time the call price will be paid. This price could be equal to the face value or it could include a call premium.