If a bond is currently trading at its face (par) value, then it must be the case that: A. the bond's yield to maturity is equal to its coupon rate. B. the bond's yield to maturity is greater than its coupon rate. C. the bond's yield to maturity is less than its coupon rate. D. the bond is a zerominuscoupon bond.

Question

Chemistry

Luka

5 April, 00:48

If a bond is currently trading at its face (par) value, then it must be the case that: A. the bond's yield to maturity is equal to its coupon rate. B. the bond's yield to maturity is greater than its coupon rate. C. the bond's yield to maturity is less than its coupon rate. D. the bond is a zerominuscoupon bond.

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Answers (2)

Know the Answer?

Adan Coffey · Answer 1

B

Explanation:

because the bond is maturity carbon

Ava Branch · Answer 2

A. the bond's yield to maturity is equal to its coupon rate.

Explanation:

The coupon rate is that amount of bond measured on the loan amount whereas the maturity yield is the rate held up to the settlement date and the investment arise up to the maturity date.

Since the bond is currently trading at its face value that means the bond price is equal to the face or par value

So, the appropriate option is A.