SIE Exam Practice Question 745

Question: 745

Which of the following is correct regarding a bond's coupon rate?

A. It is the stated annual interest rate that will be paid each period for the term of a bond.

B. It is stated as a percentage of the current market price of a bond.

C. A 5% coupon bond will pay $50 each semiannual period for a $1,000 bond.

D. A bond's coupon rate is also its yield to maturity (YTM).