If the Yield to Maturity of All of the Following

question 28

Multiple Choice

If the yield to maturity of all of the following bonds is 6%, which will trade at the greatest premium per $100 face value?

• A) a bond with a $10,000 face value, four years to maturity and 6.2% semiannual coupon payments
• B) a bond with a $500 face value, seven years to maturity and 5.2% annual coupon payments
• C) a bond with a $5,000 face value, seven years to maturity and 5.5% annual coupon payments
• D) a bond with a $1,000 face value, five years to maturity and 6.3% annual coupon payments

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Definitions:

Marketing Concept

A business philosophy suggesting that the satisfaction of customer needs and wants is the primary focus of the business.

Firm's Long-Term Success

The sustained achievement of strategic goals and objectives that enables a business to grow, compete effectively, and maintain financial health over an extended period.

Customer Needs

The desires, requirements, or necessities that customers express, which can influence their purchasing decisions.

Empowerment

The process of increasing the capacity of individuals or groups to make choices and to transform those choices into desired actions and outcomes.