Which of the Following Is True with Regards to the Yield

question 38

Multiple Choice

Which of the following is true with regards to the yield to call (YTC) ?

• A)The YTC is greater than the coupon rate, because the call price is greater than the bond's current price.
• B)The YTC is greater than the coupon rate, because the call price is smaller than the bond's current price.
• C)The YTC is greater than the coupon rate, because the call price is equal to the bond's current price.
• D)The YTC is greater than the coupon rate, because the call price includes a premium for the yield to maturity

---

Definitions:

Broker

An individual or firm that acts as an intermediary between buyers and sellers, typically for a commission or fee.

Management

The process of planning, organizing, leading, and controlling resources to achieve specific goals within an organization.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually do pay.

Purchase

The action of buying goods or services.