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Brittany and Christina Both Buy Bonds with Yield to Maturity

Question 28

Multiple Choice

Brittany and Christina both buy bonds with yield to maturity of 4% but Brittany's bond has 2 years to maturity and Christina's has 5. After one year, yields for these bonds rise.


A) The rate of return on both bonds is above 4% but Brittany's is higher.
B) The rate of return on both bonds is above 4% but Christina's is higher.
C) The rate of return on both bonds is below 4% but Brittany's is lower.
D) The rate of return on both bonds is below 4% but Christina's is lower.

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