If a Bond Offers a Current Yield of 5% and a Yield

question 34

Multiple Choice

If a bond offers a current yield of 5% and a yield to maturity of 5.45%,then the:

• A) bond is selling at a discount.
• B) bond has a high default premium.
• C) promised yield is not likely to materialize.
• D) bond must be a Treasury Inflation-Protected Security.

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Definitions:

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