Which of the Following Is the Yield of a Bond

question 32

Multiple Choice

Which of the following is the yield of a bond that offers a risk-free rate of 4 percent and a risk premium of 2 percent?

• A)2%
• B)8%
• C)12%
• D)6%
• E)9%

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Definitions:

Financial Reporting

The practice of creating reports that reveal the financial condition of a company to its management, investors, and governmental bodies.

LIFO Inventory Method

An accounting method that assumes the most recently produced items are sold first and uses those costs for accounting.

Increasing Unit Costs

Refers to a situation where the expenses associated with producing each additional unit of a product or service rise over time.

Lower Income Taxes

Strategies or circumstances that result in a reduction of the amount of income taxes a person or company owes.