Which One of the Following Statements Is Correct Concerning Premium

question 48

Multiple Choice

Which one of the following statements is correct concerning premium bonds?

• A)The premium increases when interest rates increase.
• B)The coupon rate is less than the current yield.
• C)As the time to maturity decreases, the premium increases.
• D)The yield to maturity is less than the coupon rate.
• E)The par value exceeds the face value.

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Definitions:

Trait

A distinguishing quality or characteristic, typically belonging to an individual.

Behavior

The behavior or responses of a person or group when influenced by external or internal factors.

Power-Influence Processes

Strategies or mechanisms by which individuals or groups exert control and influence decision-making within organizations.

Substantial Convergence

A significant coming together of ideas, paths, or trends toward a common point or agreement.