Question
MULTIPLE CHOICE QUESTION Which one of the following statements is NOT true? a) The yield to maturity of a bond is the discount rate that
MULTIPLE CHOICE QUESTION
Which one of the following statements is NOT true?
a) The yield to maturity of a bond is the discount rate that makes the present value of the coupon and principal payments equal to the price of the bond.
b) The yield to maturity is the yield that the investor earns if the bond is held to maturity, and all the coupon and principal payments are made as promised.
c) A bond's yield to maturity changes daily as interest rates increase or decrease.
d) All of the above are true.
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
11th edition
324422870, 324422873, 978-0324302691
