Which of the Following Statements Is CORRECT

question 66

Multiple Choice

Which of the following statements is CORRECT?

• A) The yield to maturity for a coupon bond that sells at a premium consists entirely of a positive capital gains yield;it has a zero current interest yield.
• B) The market value of a bond will always approach its par value as its maturity date approaches.This holds true even if the firm has filed for bankruptcy.
• C) Rising inflation makes the actual yield to maturity on a bond greater than a quoted yield to maturity that is based on market prices.
• D) The yield to maturity on a coupon bond that sells at its par value consists entirely of a current interest yield;it has a zero expected capital gains yield.
• E) The expected capital gains yield on a bond will always be zero or positive because no investor would purchase a bond with an expected capital loss.

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Definitions:

Meehl's Theory

An influential set of hypotheses proposed by psychologist Paul Meehl, particularly concerning the etiology of mental disorders.

Prolonged Labour

A condition in childbirth where labor lasts for a significantly longer duration than is typically expected, possibly leading to complications.

Fetal Distress

A condition in which a fetus is not well or is experiencing stress during pregnancy, often indicated by abnormal heart rate patterns detected during labor.

Birth Complication

Any problem that occurs during the birth process, potentially affecting the health of the mother or child.