A 15-Year Bond with a Face Value of $1,000 Currently

question 112

Multiple Choice

A 15-year bond with a face value of $1,000 currently sells for $850.Which statement regarding the bond's yield is true?

• A)The bond's coupon rate exceeds its current yield.
• B)The bond's current yield exceeds its yield to maturity.
• C)The bond's yield to maturity is greater than its coupon rate.
• D)The bond's current yield is equal to its coupon rate.

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Definitions:

Basilar Membrane

A structure in the cochlea of the ear that plays a key role in the sense of hearing by vibrating in response to sound, thus stimulating hair cells to send nerve impulses to the brain.

Receptor Cells

Specialized cells in the body responsive to particular stimuli like light, sound, or chemicals.

Sound Waves

Vibrations that travel through the air or another medium and can be heard when they reach a person's or animal's ear.

Amplitude

The extent or range of a vibratory movement, measured from the position of equilibrium, commonly used to describe the magnitude of sound waves or other oscillations.