Which of the following is correct? A.) If a bond is sellinag a t a discount , th

Question

Which of the following is correct? A.) If a bond is sellinag a t a discount , the yield to call is a better measure of return than the yield to maturity. B.) On an expected yield basis, the expected capital gains yield eill always be positive because an investor would not purchase a bond that is of expected to pay any cash coupon interest. C.) On an expected yield basis , the expected current yield will always be positive because an investor would not purchase a bond that is not expected to pay any cash coupon interest. D.) If a coupon bone is selling at par, its current yield equal its yield to maturity. E.) The current yield on a bond A exceeds the current yield on Bond B: therefore: Bond A must have a higher yield to maturity than Bond B

Explanation / Answer

B.) On an expected yield basis, the expected capital gains yield eill always be positive because an investor would not purchase a bond that is of expected to pay any cash coupon interest

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