Because zero- coupon bonds do not pay any cash payments until maturity, there is no need to apply compounding in the yield calculation.

Name: Because zero- coupon bonds do not pay any cash payments until maturity, there is no need to apply compounding in the yield calculation.
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Quizplus · Accepted Answer

Compounding is still necessary for zero-coupon bonds to calculate the yield to maturity, as it reflects the time value of money and the bond's price growth over time.

Because Zero- Coupon Bonds Do Not Pay Any Cash Payments