The yield on a bond is that interest rate for which the present ...

[809779]

The yield on a bond is that interest rate for which the present value of the interest and principal payments promised by the bond are
 a. equal.
  b. as large as possible.
  c. equal to the price of the bond.
  d. equal to the face value of the bond.

Question 2

A firm that wished to calculate the present value of its future nominal profits should use the ____ to do so.
 a. real interest rate
  b. nominal interest rate
  c. nominal interest rate minus the expected inflation rate
  d. real interest rate minus the expected inflation rate

[Liamb2179]

Answer to Question 1

c

Answer to Question 2

b

[809779]

Thank you

[Liamb2179]

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