The yield to maturity reported in the financial pages for Treasury securities
A) is calculated by compounding the semiannual yield.
B) is calculated by doubling the semiannual yield.
C) is also called the bond equivalent yield.
D) is calculated as the yield-to-call for premium bonds.
E) is calculated by doubling the semiannual yield and is also called the bond equivalent yield.

Question

Quizplus · Accepted Answer

The yield to maturity for Treasury securities, as reported in financial pages, is often calculated by doubling the semiannual yield, which is a simple way to annualize the rate. This method is also referred to as the bond equivalent yield, which makes it easier to compare with other investments that may compound annually.

The Yield to Maturity Reported in the Financial Pages for Treasury