The yield to maturity on a discount bond is: Question 19 options: equal to both the coupon rate and the current yield. equal to the current yield but greater than the coupon rate. greater than both the current yield and the coupon rate. less than the current yield but greater than the coupon rate. less than both the current yield and the coupon rate.

Answer: equal to both the coupon rate and the current yield.

Explanation:

Yield to maturity can be defined as the total expected return on a purchased bond on its maturity. It is a discount rate in which the sum of future cash from the bond also called coupons becomes equal to the current price or current yield of the bond. This estimate is always given in terms of Annual Percentage Rate. In this the market conventions are followed.