A 15-year bond with a face value of $1,000 currently sells for $850. Which of the following statements is CORRECT? 1. Group of answer choices 2. The bond's coupon rate exceeds its current yield. 3. The bond's current yield is equal to its coupon rate. 4. If the yield to maturity stays constant until the bond matures, the bond's price will remain at $850. 5. The bond's yield to maturity is greater than its coupon rate. 6. The bond's current yield exceeds its yield to maturity.
A 15-year bond with a face value of $1,000 currently sells for $850. Which of the following statements is CORRECT? 1. Group of answer choices 2. The bond's coupon rate exceeds its current yield. 3. The bond's current yield is equal to its coupon rate. 4. If the yield to maturity stays constant until the bond matures, the bond's price will remain at $850. 5. The bond's yield to maturity is greater than its coupon rate. 6. The bond's current yield exceeds its yield to maturity.
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
Problem 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...
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A 15-year bond with a face value of $1,000 currently sells for $850. Which of the following statements is CORRECT?
1. Group of answer choices
2. The bond's coupon rate exceeds its current yield.
3. The bond's current yield is equal to its coupon rate.
4. If the yield to maturity stays constant until the bond matures, the bond's price will remain at $850.
5. The bond's yield to maturity is greater than its coupon rate.
6. The bond's current yield exceeds its yield to maturity.
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