Asked by
demodraick foreman
on Dec 08, 2024
Verified
A bond will sell at a discount when
A) the coupon rate is greater than the current yield, and the current yield is greater than yield to maturity.
B) the coupon rate is greater than yield to maturity.
C) the coupon rate is less than the current yield, and the current yield is greater than the yield to maturity.
D) the coupon rate is less than the current yield, and the current yield is less than yield to maturity.
E) None of the options are true.
Coupon Rate
The yearly rate of interest that the entity issuing a bond pays to the bondholders, represented as a percentage of the bond's principal value.
Yield To Maturity
The expected rate of return on a bond if held until its maturity date, reflecting both interest payments and any gain or loss if the bond was purchased at a discount or premium.
- Ascertain how changes in market environments and interest rates influence bond yields and values.
Verified Answer
AO
Learning Objectives
- Ascertain how changes in market environments and interest rates influence bond yields and values.