If you know the face value, bond price, maturity date, and coupon rate for a given bond, what can you also infer about that bond using only this information? A. Whether the yield to maturity is higher or lower than the coupon rate. B. If the bond issuer is going to default. C. How many bonds are outstanding. D. The firm's cost of equity. E. Both (A) and (D).

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
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Give Correct Answer with explanation and also provide explanation of Correct and incorrect option 

If you know the face value, bond price, maturity date, and coupon rate for a given bond, what can you also infer about that bond
using only this information?
A.
Whether the yield to maturity is higher or lower than the coupon rate.
B.
If the bond issuer is going to default.
C.
How many bonds are outstanding.
D.
The firm's cost of equity.
E.
Both (A) and (D).
Transcribed Image Text:If you know the face value, bond price, maturity date, and coupon rate for a given bond, what can you also infer about that bond using only this information? A. Whether the yield to maturity is higher or lower than the coupon rate. B. If the bond issuer is going to default. C. How many bonds are outstanding. D. The firm's cost of equity. E. Both (A) and (D).
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