6. Which of the following statements is (are) correct? O A. All else equal, if a bond's yield to maturity increases, its price will fall. B. All else equal, if a bond's yield to maturity increases, its current yield will fall. C. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at a premium over par. O D. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at par. O E. If a bond's required rate of return exceeds its coupon rate, the bond will sell at a premium.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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6. Which of the following statements is (are) correct?
O A. All else equal, if a bond's yield to maturity increases, its price will fall.
B. All else equal, if a bond's yield to maturity increases, its current yield will fall.
OC. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at a premium over par.
D. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at par.
OE If a bond's required rate of return exceeds its coupon rate, the bond will sell at a premium.
Transcribed Image Text:6. Which of the following statements is (are) correct? O A. All else equal, if a bond's yield to maturity increases, its price will fall. B. All else equal, if a bond's yield to maturity increases, its current yield will fall. OC. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at a premium over par. D. If a bond's yield to maturity exceeds its coupon rate, the bond will sell at par. OE If a bond's required rate of return exceeds its coupon rate, the bond will sell at a premium.
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