The rate of discount equalizing the market price of a security with all net cash flows expected between the time the asset is purchased and the time it is sold is known as the:
A) Simple interest rate
B) Current yield
C) Discount rate
D) Coupon rate
E) Holding-period yield
F) Add-on interest rate
G) Annual percentage rate (APR)
H) Yield to maturity

Question

Quizplus · Accepted Answer

The holding-period yield is the rate of discount that equates the market price of a security with all net cash flows expected during the holding period of the asset.

The Rate of Discount Equalizing the Market Price of a Security