The yield to maturity on a bond is:

1. above the coupon rate when the bond sells at a discount and below the coupon rate when the bond sells at a premium.
2. the discount rate that will set the present value of the payments equal to the bond price.
3. equal to the holding period of returns when you sell the position.

What is the set of the correct statement?

a. 1 only

b. 2 only

c. 1 and 2 only

d. 1, 2, and 3