Homework answers / question archive / Which of the following statements is FALSE? O A bond trades at par when its coupon rate is equal to its yield to maturity

Which of the following statements is FALSE? O A bond trades at par when its coupon rate is equal to its yield to maturity

Finance

Share With

Which of the following statements is FALSE? O A bond trades at par when its coupon rate is equal to its yield to maturity. The promised interest payments of a bond are called coupons. O The only cash payment the investor will receive from a zero-coupon bond is the face value of the bond on the maturity date. Because the coupon bond provides cash flows at different points in time, the yield to maturity of a coupon bond is the simple average of the yields of the zero-coupon bonds of equal and shorter maturities. The IRR of an investment opportunity is the discount rate at which the NPV of the investment opportunity is equal to zero.