The Yield to Call Is a More Conservative Yield Measure

question 67

Multiple Choice

The yield to call is a more conservative yield measure whenever the price of a callable bond is quoted at a value

• A) equal to or greater than par plus one year's interest.
• B) equal to par.
• C) equal to par less one year's interest.
• D) less than par.
• E) 5 percent over par.

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Definitions:

Negotiability

The quality of a financial instrument that allows it to be transferred or assigned from one party to another in exchange for value.

Sum Certain In Money

A specified, fixed, or exact amount of money that is owed or due to be paid under a contract or agreement.

Enforceable Contract

a valid agreement between parties that can be legally upheld and compelled in a court of law.

Payment

The transfer of money or goods from one party to another as a fulfillment of a transaction or obligation.