Which of the Following Statements Is False

question 13

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:

Premium Rate

The price of an insurance policy, typically quoted as a cost per hundred or thousand dollars of coverage.

Annual Premium

Annual Premium refers to the amount paid yearly for an insurance policy to keep it active and provide coverage.

Short-rate Refund

A refund of a portion of a premium on an insurance policy, calculated using a method that is less than pro-rata, often involving a penalty for early cancellation.

Annual Premium

The amount paid annually for an insurance policy, providing coverage over a specified period of time.