
A
To explain: The value of YTM is greater than the yield to discount bond.
Introduction: The YTM stands for yield to maturity means it gives return value after the completion of the maturity period of the bond. For long term bonds, its value is very high.
B
To select: More profitable bond when rates fall down.
Introduction : The expected return rate is defined as the measured gain or loss of the bond after the maturity period. The positive value of return gives gain or profit in the investment whereas negative shows the loss in investment.
C
To explain: Condition when call protection is offered.
Introduction: Call protection is working as a protective shield for the callable securities. That security is protected for some period that period is called cushion or deferment period. When yield price decreases call protection is used.

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Chapter 14 Solutions
Investments, 11th Edition (exclude Access Card)
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