• 2021-04-14
    The return on a bond is equal to the yield to maturity when _________
  • the holding period and the maturity of the bond are identical.

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    • 0

      The current yield for a 4.5% coupon, 10-year bond, with a maturity par value of $100 and currently priced at $85.70 is closest to

    • 1

      If you expect the inflation rate to be 15 percent next year and a one - year bond has a yield to maturity of 7 percent, then the real interest rate on this bond is _________

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      A capital investment’s internal rate of return( ). A: Must exceed the cost of capital in order for the firm to accept the investment. B: C: Statements c and d are correct. D: Changes when the cost of capital changes. E: Is similar to the yield to maturity on a bon F: Is equal to the annual net cash flows divided by one half of the project’s cost when the cash flows are an annuity.

    • 3

      A capital investment’s internal rate of return ( ) A: Changes when the cost of capital changes. B: Must exceed the cost of capital in order for the firm to accept the investment. C: Statements c and d are correct. D: Is similar to the yield to maturity on a bond. E: Is equal to the annual net cash flows divided by one half of the project’s cost when the cash flows are an annuity.

    • 4

      A 6% annual coupon paying bond has two years remaining to maturity and is priced at par. Assuming a 40% tax rate, the after-tax yield for this bond is closest to:() A: 2.4%. B: 3.6%. C: 4.8%.