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Which of the Following Statements Is CORRECT

Question 16

Multiple Choice

Which of the following statements is CORRECT?


A) A bond is likely to be called if its coupon rate is below its YTM.
B) A bond is likely to be called if its market price is below its par
Value.
C) Even if a bond's YTC exceeds its YTM, an investor with an investment horizon longer than the bond's maturity would be worse
Off if the bond were called.
D) A bond is likely to be called if its market price is equal to its
Par value.
E) A bond is likely to be called if it sells at a discount below par.
Hard:

Correct Answer:

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