True or falseCoupon rate is used to calculate the coupon payment,and YTM is a discount rate, which will make thepresent value of future cash flow equals the marketprice, used to measure the real rate of return.Some expenditures are fixed in nominal terms andtherefore increase in real terms when the inflation isserious.The preference stockholders can receive dividends at afixed rate out of profits before the commonshareholders.

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Coupon rate is used to calculate the coupon payment, and YTM is a discount rate, which will make the present value of future cash flow equals the market price, used to measure the real rate of return.

Coupon rate is used to calculate the coupon payment, and YTM is a discount rate, which will make the present value of future cash flow equals the market price, used to measure the real rate of return.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

True or false
Coupon rate is used to calculate the coupon payment,
and YTM is a discount rate, which will make the
present value of future cash flow equals the market
price, used to measure the real rate of return.
Some expenditures are fixed in nominal terms and
therefore increase in real terms when the inflation is
serious.
The preference stockholders can receive dividends at a
fixed rate out of profits before the common
shareholders.

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