Which of the following relationships apply to a par value bond?
I.coupon rate

Name: Which of the following relationships apply to a par value bond? I.coupon rate < yield-to-maturity II.current yield = yield-to-maturity III.market price = call price IV.market price = face value
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Question

Which of the following relationships apply to a par value bond?
I.coupon rate < yield-to-maturity
II.current yield = yield-to-maturity
III.market price = call price
IV.market price = face value

Quizplus · Accepted Answer

II and IV are correct for a par value bond. When a bond is at par value, its current yield equals its yield-to-maturity because the bond is priced at its nominal value, and the market price equals its face value.

Which of the Following Relationships Apply to a Par Value