Which of the Following Statements Is CORRECT

question 80

Multiple Choice

Which of the following statements is CORRECT?

• A) If a bond is selling at a discount,the yield to call is a better measure of return than is the yield to maturity.
• B) On an expected yield basis,the expected capital gains yield will always be positive because an investor would not purchase a bond with an expected capital loss.
• C) On an expected yield basis,the expected current yield will always be positive because an investor would not purchase a bond that is not expected to pay any cash coupon interest.
• D) If a coupon bond is selling at par,its current yield equals its yield to maturity,and its expected capital gains yield is zero.
• E) The current yield on Bond A exceeds the current yield on Bond B;therefore,Bond A must have a higher yield to maturity than Bond B.

---

Definitions:

Simp

In internet slang, a simp is someone who does too much for a person they like, but in mathematical contexts, simp could refer to a simplification of an expression or equation.

Add

To combine one quantity with another to find the total or sum.

MT

In logic, Modus Tollens, a valid argument form where if 'P implies Q' is true and 'Q' is false, then 'P' must also be false.

Simp

A slang term often used online to describe someone who overly sympathizes or performs excessive attention and affection towards another person, typically to gain their affection, without receiving any in return.