A 10-year bond pays an annual coupon, its YTM is 8%, and it currently trades at a premium. Which of the following statements best describes bond yields?
A) The bond's current yield is less than 8%.
B) If the yield to maturity remains at 8%, then the bond's price will decline over the next year.
C) The bond's coupon rate is less than 8%.
D) If the yield to maturity remains at 8%, then the bond's price will remain constant over the next year.
Correct Answer:
Verified
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