Which of the Following Statements Is FALSE

question 90

Multiple Choice

Which of the following statements is FALSE?

• A)Zero-coupon bonds are also called pure discount bonds.
• B)The IRR of an investment opportunity is the discount rate at which the NPV of the investment opportunity is equal to zero.
• C)The yield to maturity for a zero-coupon bond is the return you will earn as an investor from holding the bond to maturity and receiving the promised face value payment.
• D)When prices are quoted in the bond market,they are conventionally quoted in increments of $1000.

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Definitions:

Economy

The system by which goods and services are produced, distributed, and consumed within a society or area.

Depression of the 1930s

A severe worldwide economic downturn that lasted throughout the 1930s, marked by significant declines in industrial production, widespread unemployment, and deflation.

Recession

A temporary stage of economic depletion, highlighted by a downturn in trade and industrial action, normally identified by a GDP reduction in two back-to-back quarters.

Stagflation

A situation in the economy where inflation and unemployment rates are high simultaneously, leading to slow economic growth.