The bond market requires a return of 10.7 percent on the twenty year bonds that Paul's Poultry has issued. Which of the following describes the 10.7 percent?

A. coupon rate

B. face rate

C. call rate

D. yield to maturity

E. interest rate

Question

Business

Justice Matthews

7 July, 01:03

The bond market requires a return of 10.7 percent on the twenty year bonds that Paul's Poultry has issued. Which of the following describes the 10.7 percent?

A. coupon rate

B. face rate

C. call rate

D. yield to maturity

E. interest rate

+5

Answers (1)

Know the Answer?

Thaddeus Benjamin · Answer 1

The correct option is D

Explanation:

YTM (Yield to Maturity) is the aggregate return or yield which is predicted on the bond if the bond is held till the maturity date. It is considered to a long term bond but stated or expressed as the annual rate.

Under this situation or question, bond need a return is 10.7%, so it will be a yield to maturity as 10.7% is a return which the person will get whereas yield is what the bond will provide on its maturity date.

The bond market requires a return of 10.7 percent on the twenty year bonds that Paul's Poultry has issued. Which of the following describes the 10.7 percent?A. coupon rateB. face rateC. call rateD. yield to maturityE. interest rate

The bond market requires a return of 10.7 percent on the twenty year bonds that Paul's Poultry has issued. Which of the following describes the 10.7 percent?

A. coupon rate

B. face rate

C. call rate

D. yield to maturity

E. interest rate