Refer to the Above Graph

question 209

Multiple Choice

Refer to the above graph. The slope of the line tangent to the curve at point A is:

• A) 0
• B) .5
• C) 2
• D) 4

---

Definitions:

Yield To Maturity

The total return anticipated on a bond if it is held until it matures, including both interest payments and the gain or loss incurred if purchased at a price different from its face value.

Face Value

The nominal or dollar value printed on a security, such as a bond or stock certificate, representing the amount due to the holder at maturity, not including interest or dividends.

Callable Bonds

Bonds that can be redeemed by the issuer prior to their maturity date, often at a premium price.

Par Value

The face value of a bond or the stock value stated in the corporate charter, which is often a nominal amount.