Question: Please select a statement that is false: a. A premium bond is a bond whose price is higher than its face value. b. A zero

Please select a statement that is false:
a. A premium bond is a bond whose price is higher than its face value.
b. A zero coupon bond is a discount bond.
c. The price of a premium bond gradually falls as it gets closer to tis maturity .
d. Any bond whose coupon rate is greater than the market interest rate is a premium bond.
e. When coupon rate of a bond is equal to the market interest rate, its price is equal to its face value.
f.When all the other things are equal , a bond with a higher coupon rate has higher price .
g. When all the other things are equal , the price of a bond falls when market interest rate rises .
H. If one can buy a coupon bond at its face value , the yield to maturity of the bond is greater than its coupon rate.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!