Asked by Divya Patel on Apr 25, 2024
Verified
The rate of return required by investors in the market for owning a bond is called the:
A) Coupon.
B) Face value.
C) Maturity.
D) Yield to maturity.
E) Coupon rate.
Yield to Maturity
The overall anticipated gain on a bond if retained until its expiration date.
- Understand the principle of yield to maturity and how to calculate it.
Verified Answer
BM
Bongiwe Millicent7 days ago
Final Answer :
D
Explanation :
The rate of return required by investors in the market for owning a bond is referred to as the Yield to Maturity (YTM). This rate reflects the total return expected on a bond if it is held until its maturity date, including all coupon payments and the repayment of the bond's face value.
Learning Objectives
- Understand the principle of yield to maturity and how to calculate it.