Which of the Following Statements Is CORRECT

question 34

Multiple Choice

Which of the following statements is CORRECT?

• A) If a coupon bond is selling at a premium,then the bond's current yield is zero.
• B) If a coupon bond is selling at a discount,then the bond's expected capital gains yield is negative.
• C) If a bond is selling at a discount,the yield to call is a better measure of the expected return than the yield to maturity.
• D) The current yield on Bond A exceeds the current yield on Bond B.Therefore,Bond A must have a higher yield to maturity than Bond B.
• E) If a coupon bond is selling at par,its current yield equals its yield to maturity.

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Definitions:

Normally Distributed

Describes a type of continuous probability distribution for a real-valued random variable where the data tends to form a symmetrical bell curve.

Median

The middle value in a data set, arranging the data in ascending order, or the average of the two middle values if the dataset is even.

SAT Scores

SAT Scores are standardized test results used for college admissions in the United States, assessing mathematical, reading, and writing skills.

Standard Deviation

A measure of dispersion or variability that quantifies how much individual data points deviate from the mean of a dataset.