Which of the following is NOT a definition of yield to maturity?
A) investors' required rate of return on a bond investment.
B) discount rate that equates present value of future cash flows with a bond's price.
C) return that an investor will earn if they buy the bond for its market price and hold it until
maturity.
D) discount rate that equates present value of future cash flows with a bond's face value.
D
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On June 8, Williams Company issued an $80,000, 5%, 120-day note payable to Brown Industries. Assuming a 360-day year, what is the maturity value of the note?
a. $82,600 b. $84,000 c. $81,333 d. $88,200
Commercial paper is basically a contract for the payment of money.
Answer the following statement true (T) or false (F)
Which of the following is a reason that the FASB should closely watch the lobbying behavior of free riders?
a. Responding to the interests of free riders could lead to an underproduction of accounting information. b. Free riders claim to be acting in the public interest but actually make the market less competitive. c. Free riders are not affected by accounting regulation. d. Free riders do not have the direct economic interests in information production that others have.
A company purchased $10,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. The freight charge, $500, was added to the invoice amount. On June 20, it returned $800 of that merchandise. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled to. The cash paid on June 24 equals:
A. $10,300. B. $9,424. C. $10,500. D. $10,200. E. $9,224.