For this coupon bond:

Question

Quizplus · Accepted Answer

The yield to maturity is the rate of return that an investor can expect to earn if they buy the bond and hold it until maturity. In this case, the yield to maturity is 5.53%, as stated in option C. Option A and B both have higher yields, which would indicate that the bond is selling at a discount (below par value). Option D is not possible, as a bond cannot have a yield to maturity of 0%. Option E is not correct, as the coupon yield is different from the yield to maturity.

For This Coupon Bond