EBK CORPORATE FINANCE
EBK CORPORATE FINANCE
4th Edition
ISBN: 9780134202785
Author: DeMarzo
Publisher: VST
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Chapter 6, Problem 9P

Explain why the yield of a bond that trades at a discount exceeds the bond’s coupon rate.

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Why does the yield of a bond that trades at a discount exceeds the bond’s coupon rate?
Explain the difference between the coupon rate and the required return on a bond.
Why does the yield on a discount bond surpass the coupon rate?

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EBK CORPORATE FINANCE

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