So long as a bond sells for an amount above its face value,the coupon interest rate and yield to maturity remain equal.

Question

Quizplus · Accepted Answer

The coupon interest rate and yield to maturity are not always equal, even if a bond sells for an amount above its face value. The yield to maturity takes into account the price paid for the bond and any interest payments received over the life of the bond, while the coupon interest rate only looks at the annual interest payment as a percentage of the bond's face value. If the price paid for the bond is higher or lower than the face value, then the yield to maturity will be different from the coupon interest rate.

So Long as a Bond Sells for an Amount Above