1. A bond that pays no separate interest payments is called a(n):

A. Premium bond.

B. Coupon bond.

C. Junk bond.

D. Zero-coupon bond.

E. Investment grade bond.

2. When a company sell bonds, it is ______________ money.

A. Borrowing

B. Lending

C. Investing

D. Reinvesting

E. Financing

3. For a bond selling at par, the yield to maturity must be _____________.

A. Greater than the coupon rate.

B. Less than the coupon rate.

C. Greater than the face value.

D. Greater than the required rate of return.

E. Equal to the coupon rate.

Thank you