Suppose Two Bonds of Equivalent Risk and Maturity Have Different

question 72

True/False

Suppose two bonds of equivalent risk and maturity have different prices such that one is a premium bond and one is a discount bond. The premium bond must have a greater expected return than the discount bond.

---

Definitions:

National Security

Measures taken by a state to ensure its survival, economic stability, and protection from threats.

Tariff Revenue

The income earned by a government from levying taxes on imported goods.

Job Creation

Job creation is the process of generating new employment opportunities within an economy, often influenced by economic policies, market demand, and business growth.

World Price

The international market price of a good or service, determined by global supply and demand conditions.