The bond's annual coupon rate divided by its market price is referred to as the Multiple Choice yield to call. yield to maturity. current yield. term structure of interest rates.
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The bond's annual coupon rate divided by its market price is referred to as the
Multiple Choice
yield to call.
yield to maturity.
current yield.
term structure of interest rates.
Step by step
Solved in 4 steps
- he interest rate used to calculate the present value of a bond's cash flows is often referred to as the:Group of answer choices dividend rate. discount rate. multiplier. yield to maturityThe dollar interest received divided by the market price of the bond is called the Group of answer choices A. current yield. B. yield to maturity. C. coupon rate. D. par value.Explain the relationship between the price of a bond, coupon rate, yield and time.
- The formula (Coupon Payment / Current bond price) calculates the _______. Multiple Choice Current yield. Risk-free rate. Coupon rate. Yield to maturity Bond premium.he yield that a bond will earn given that it is bought back by the issuer at the earliest possible date is the: Select one: a. current yield b. yield to maturity c. yield to put d. market yield e. yield to callCurrent yield is used to determine Seleccione una: a. A portion of the yield on an investment b. The payout of a bond investment c. The amount of money a bond investor will earn d. The coupon rate of a bond investment
- Define each of the following terms:g. Current yield (on a bond); yield to maturity (YTM); yield to call (YTC)A bond's real rate of return is reflected by the bond's 1). YTM 2). Coupon Rate 3). Par Value 4). Selling Price 5). Redemption ValueThe principal amount of a bond that is repaid at the end of the maturity is called: Coupon Market price Face value
- Interest Rate risk depends upon how sensitive the bond price is to interest rate changes (i.e., maturity and coupon rate). T/FDiscuss the following statement: A bond’s yield to maturity is the bond’s promised rate ofreturn, which equals its expected rate of return.To calculate the price of a coupon bond, the following information is required: Select one: O A. Face value of the bond, yield to maturity rate, maturity date and inflation rate. O B. Face value of the bond, yield to maturity rate, maturity date, coupon rate and inflation. O C. Face value of the bond, inflation rate, coupon rate and coupon rate. O D. Face value of the bond, yield to maturity rate, maturity date and coupon rate.