Which of the Following Statements Is CORRECT

question 34

Multiple Choice

Which of the following statements is CORRECT?

• A) If a coupon bond is selling at a premium,then the bond's current yield is zero.
• B) If a coupon bond is selling at a discount,then the bond's expected capital gains yield is negative.
• C) If a bond is selling at a discount,the yield to call is a better measure of the expected return than the yield to maturity.
• D) The current yield on Bond A exceeds the current yield on Bond B.Therefore,Bond A must have a higher yield to maturity than Bond B.
• E) If a coupon bond is selling at par,its current yield equals its yield to maturity.

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