The Yield to Maturity on a Discount Bond Is

question 42

Multiple Choice

The yield to maturity on a discount bond is:

• A)less than both the current yield and the coupon rate
• B)greater than both the current yield and the coupon rate
• C)equal to the current yield but greater than the coupon rate
• D)less than the current yield but greater than the coupon rate
• E)equal to both the coupon rate and the current yield

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Definitions:

Elderly or Disabled

Elderly or Disabled refers to tax terms that qualify individuals for certain tax deductions or credits based on their age, typically over 65, or if they have a qualifying permanent disability.

Base Amount

Refers to a reference value used in calculations, often determining thresholds or limits in tax and financial contexts.

Credit Calculation

Credit calculation involves determining the amounts for tax credits a taxpayer is eligible for, which can directly reduce the amount of taxes owed.

Education Credits

Tax credits designed to offset the costs of education for college or vocational school tuition and fees.