The Yield to Maturity Reported in the Financial Pages for Treasury

question 29

Multiple Choice

The yield to maturity reported in the financial pages for Treasury securities

• A)is calculated by compounding the semiannual yield.
• B)is calculated by doubling the semiannual yield.
• C)is also called the bond equivalent yield.
• D)is calculated as the yield-to-call for premium bonds.
• E)Both B and C are true.

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Definitions:

Random Variable

A variable whose values depend on outcomes of a statistical experiment where the exact outcomes are uncertain.

Rainy Days

Days on which a significant amount of precipitation falls, typically defined as days when there is at least 0.1 inches of rainfall.

Expected Amount

The average value or mean that one anticipates to occur over a long series of trials in a random experiment.

Pair Of Dice

Two small cubes with faces marked from one to six, used in games to generate random numbers through tossing.