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    Fundamentals of Corporate Finance Study Set 14
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    Exam 6: Bonds
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    A Bond Is Currently Trading Below Par
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A Bond Is Currently Trading Below Par

Question 3

Question 3

Multiple Choice

A bond is currently trading below par. Which of the following must be true about that bond?


A) The bond's yield to maturity is less than its coupon rate.
B) The bond is a zero-coupon bond.
C) The bond's yield to maturity is greater than its coupon rate.
D) B or C above

Correct Answer:

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