Stephenson Co

question 11

Multiple Choice

Stephenson Co.'s 15-year bond with a face value of $1,000 currently sells for $850. Which of the following statements is CORRECT?

• A) the bond's current yield exceeds its yield to maturity.
• B) the bond's yield to maturity is greater than its coupon rate.
• C) the bond's current yield is equal to its coupon rate.
• D) if the yield to maturity stays constant until the bond matures, the bond's price will remain at $850.
• E) the bond's coupon rate exceeds its current yield.

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Definitions:

Venture Capitalists

Investors who provide capital to startups and small businesses with long-term growth potential.

Equity

Represents fairness or justice in the way people are treated and involves ensuring that everyone has access to equal opportunities.

Stock

A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings.

Post-money Valuation

The estimated value of a company after external financing and investments have been added to its balance sheet.