1.) True or False: The market rate of interest is equal to the risk-free rate plus...
1.) True or False: The market rate of interest is equal to the risk-free rate plus a risk premium.
2.) True or False: The coupon rate of a bond typically equals the yield (market) rate.
Homework Answers
Answers :
1) True :
The market rate of interest = risk-Free Rate ( Rf) + Risk
Premium ( 
( Rf- Rm))
2) False
Bond Coupon rate may be any rate above, Below or Equal to the market rate, the Price of the bond is Depends on the Gap between the Coupon rate and Market Rate
Add Answer to:
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