Examlex
What are the three components of the evoked set method of evaluating purchase alternatives? Describe each.
Yield to Maturity
Yield to Maturity (YTM) is the total return anticipated on a bond if the bond is held until the date it matures, accounting for interest payments and principal recovery.
Par Value
The face value of a bond or stock as stated by the issuing company, not necessarily its market value.
Annual Coupon
The annual interest payment made to bondholders, typically fixed and expressed as a percentage of the bond's face value.
Income Effect
The change in an individual's or economy's income and how that change affects the quantity demanded of a good or service.
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