The Higher the Yield to Maturity on a Bond, the Closer

question 18

True/False

The higher the yield to maturity on a bond, the closer to par the bond will trade.
Increasing the yield to maturity will increase the difference between the par value and the price that buyers are willing to pay for it.

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Definitions:

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, calculated as current assets divided by current liabilities.

Salaries Payable

An account representing the amounts owed to employees for work performed but not yet paid.

Price/Earnings Ratio

A valuation metric for a stock, calculated by dividing the market price per share by the earnings per share.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue.