Question regarding yield to maturity


The following statements are true. Explain why? a. If a bond"s coupon rate is higher than its yield to maturity, then the bond will sell for more than face value. b. If a bond"s coupon rate is lower than its yield to maturity, then the bond"s price will increase over its remaining maturity.

The following statements are true. Explain why.

a. If a bond's coupon rate is higher than its yield to maturity, then the bond will sell for more than face value.

b. If a bond's coupon rate is lower than its yield to maturity, then the bond's price will increase over its remaining maturity.

Solution Preview :

Prepared by a verified Expert
Finance Basics: Question regarding yield to maturity
Reference No:- TGS0679233

Now Priced at $10 (50% Discount)

Recommended (91%)

Rated (4.3/5)