The ________ is the rate of return that an investor will earn if a bond is redeemed by the issuer at the earliest permissible date.

Question

Quizplus · Accepted Answer

The yield-to-call is the rate of return that an investor will earn if a bond is redeemed by the issuer at the earliest permissible date, hence option C is the correct answer. The yield-to-maturity is the rate of return that an investor will earn if the bond is held until maturity, and the market rate is the prevailing interest rate in the market. The yield-to-conversion is a calculation used for convertible bonds, and the current yield is the annual income generated by the bond divided by its current market price.

The ________ Is the Rate of Return That an Investor