The Current Yield on a Bond Is Equal to

question 21

Multiple Choice

The current yield on a bond is equal to

• A)annual interest payment divided by the current market price.
• B)the yield to maturity.
• C)annual interest divided by the par value.
• D)the internal rate of return.

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Definitions:

Truth in Lending Act

A federal law designed to protect consumers in their dealings with lenders and creditors by requiring clear disclosure of loan terms and costs.

Revolving Credit

A credit agreement that allows a borrower to withdraw, repay, and redraw loans repeatedly up to a certain credit limit.

Magnuson-Moss Act

A federal law enacted to protect consumers from deceptive warranty practices, improving the enforceability of warranties on consumer products.

Injunctive Relief

A court order requiring a party to do or to refrain from doing specific acts.