The Yield-To-Maturity on a Bond Is the Interest Rate You

question 46

Multiple Choice

The yield-to-maturity on a bond is the interest rate you earn on your investment if interest rates do not change.If you actually sell the bond before it matures,your realized return is known as the holding period yield.Suppose that today,you buy a 12 percent annual coupon bond for $1,000.The bond has 13 years to maturity.Two years from now,the yield-to-maturity has declined to 11 percent and you decide to sell.What is your holding period yield?

• A)8.84 percent
• B)9.49 percent
• C)12.00 percent
• D)13.01 percent
• E)14.89 percent

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Definitions:

Left-Brained

The notion that people who are "left-brained" tend to be more logical, analytical, and objective in their thought processes.

Right-Brained

A popularized concept suggesting that the right hemisphere of the brain is more involved in creative and intuitive processes.

Dendrites

The branched projections of a neuron that act to conduct the electrochemical stimulation received from other neural cells to the cell body, or soma.

Skill

A learned ability to carry out a task with pre-determined results often within a given amount of time, energy, or both.