The Yield to Maturity on a Bond Is ________

question 98

Multiple Choice

The yield to maturity on a bond is ________.

• A)below the coupon rate when the bond sells at a discount,and equal to the coupon rate when the bond sells at a premium
• B)the discount rate that will set the present value of the payments equal to the bond price
• C)based on the assumption that any payments received are reinvested at the coupon rate
• D)none of the above.
• E)A,B,and C.

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Definitions:

Stakeholders

Individuals or groups that have an interest or stake in the outcome of a project, decision, or outcome.

Shareholders

Individuals or entities that own shares in a corporation, giving them ownership interests and rights, such as voting on corporate matters.

Debtors

Individuals or entities that owe money to another entity, typically referring to those owing money as recorded by the creditor.

Creditors

Individuals or institutions that lend money or extend credit to others, expecting to be repaid in the future, often with interest.