Which of the Following Statements Is CORRECT

question 101

Multiple Choice

Which of the following statements is CORRECT?

• A)The total return on a bond during a given year consists only of the coupon interest payments received.
• B)All else equal, a bond that has a coupon rate of 10% will sell at a discount if the required return for bonds of similar risk is 8%.
• C)The price of a discount bond will increase over time, assuming that the bond's yield to maturity remains constant.
• D)For a given firm, its debentures are likely to have a lower yield to maturity than its mortgage bonds.
• E)When large firms are in financial distress, they are almost always liquidated, whereas smaller firms are generally reorganized.

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Definitions:

Personal Property

Items owned by an individual or entity that are movable and not fixed to real estate, such as furniture, vehicles, and electronics.

Peril

A particular hazard or reason for loss that an insurance policy protects against, for example, fire, theft, or acts of nature.

Professional Insurance

Insurance coverage designed to protect professionals from liability claims resulting from their business activities, such as errors, omissions, or neglect.

Malpractice Insurance

A type of professional liability insurance that provides coverage to healthcare professionals for claims arising from allegations of medical errors or negligence.