A Bond Has a Market Price That Exceeds Its Face

question 1

Multiple Choice

A bond has a market price that exceeds its face value.Which of the following features currently apply to this bond?
I.discounted price
II.premium price
III.yield-to-maturity that exceeds the coupon rate
IV.yield-to-maturity that is less than the coupon rate

• A)III only
• B)I and III only
• C)I and IV only
• D)II and III only
• E)II and IV only

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Definitions:

Government Aid

Financial assistance or other resources provided by the government to individuals, organizations, or countries in need.

Profit-Making Organizations

Entities that operate with the primary goal of earning revenue in excess of their operational costs.

Private Non-Profit Agencies

Organizations that operate independently from government control, not seeking to generate profits for owners or shareholders, and often focused on serving social or community-based causes.

Discretionary Funds

Money available for spending and investment that is not earmarked for specific obligations.