Which of the following statements is FALSE?AA bond trades at par when its coupon rate is equal to its yield to maturity.BA bond trades at premium when its coupon rate is greater than its yield to maturity.CA bond that has zero coupon rate is a discount bond.DIf a coupon bond's yield to maturity exceeds its coupon rate, the present value of its cash flows at the yield to maturity will be greater than its face value.SUBMIT

Activity 2: Q3) Which of the following statements is FALSE? A A bond trades at par when its coupon rate is equal to its yield to maturity. B A bond trades at premium when its coupon rate is greater than its yield to maturity. C A bond that has zero coupon rate is a discount bond. D If a coupon bond's yield to maturity exceeds its coupon rate, the present value of its cash flows at the yield to maturity will be greater than its face value. SUBMIT

Bond A has a coupon rate of 10% and a yield of 13%. Bond B has coupon rate of 5% and sells for the same price as Bond A. Both bonds have the same face value and maturity. From this, which of the followings is the most inappropriate statement? A. The yield of Bond B is greater than 5%. B. The yield of Bond B is less than 10%. C. Bond A is a discount bond. D. Both bonds are discount bonds.

Bond A is currently selling at par and has a yield of 5%. Bond B has the same coupon rate as A but is selling at a premium. Given this information, which of the following statements is correct.  Bond B's coupon rate is below 5%.  Bond B's coupon rate is above 5%.  Bond B's yield is below 5%.  Bond B's yield is above 5%.

Which of the following statements about zero coupon bonds is FALSE? A. When the bonds mature, the issuing firm is faced with a small cash outflow relative to the cash inflow the firm receives when the bonds are initially issued. B. Zero coupon bonds have lower interest rate risk than bonds with high coupons. C. Zero coupon bonds are an extremely popular way for corporations to borrow money. D. Most zero coupon bonds in the U.S. are government issues.

Which of the following is correct for a bond currently selling at a premium to par?Select one:a.Its current yield is higher than its coupon rate.b.Its current yield is lower than its coupon rate.c.Its yield to maturity is higher than its coupon rate.d.Its default risk is extremely low.