The Holding Period Yield (HPY)calculation Differs from the Yield to Maturity

question 17

Multiple Choice

The holding period yield (HPY) calculation differs from the yield to maturity (YTM) calculation in that:

• A) the future value for the HPY calculation is always the par value of the bond
• B) the future value for the HPY calculation is the sale price of the bond
• C) the time period for the HPY calculation is the number of time periods until the bond matures
• D) the time period for the HPY calculation is the number of time periods the bond was actually held
• E) Both (b)and (d)

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Definitions:

Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, expressed as a ratio or percentage.

Tax

Mandatory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund various public expenditures.

Buyer

An individual or entity that purchases goods or services for personal use or consumption.

Tax

Tax is a compulsory financial charge levied by a government on individuals, corporations, or transactions to fund public expenditures.