Which of the Following Statements Is Most Correct

question 61

Multiple Choice

Which of the following statements is most correct?

• A) The market value of a bond will always approach its par value as its maturity date approaches, provided the issuer of the bond does not go bankrupt.
• B) If the Federal Reserve unexpectedly announces that it expects inflation to increase, then we would probably observe an immediate increase in bond prices.
• C) The total yield on a bond is derived from interest payments and changes in the price of the bond.
• D) Statements a and c are correct.
• E) All of the statements above are correct.

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Definitions:

Sample Variance

A statistic that measures the dispersion of a sample set of data points around their sample mean.

Sample Standard Deviation

Sample Standard Deviation is a measure that quantifies the amount of variation or dispersion of a set of sample data values around the sample mean.

Ages

A quantitative variable representing the length of time that an individual or object has existed.

Standard Deviation

A quantification tool that assesses how much data values diverge or spread out from their mean.