An adjustment factor is used to convert a T-bond to a bond yielding
A) 5%
B) 6%, a decline from the former 8% level
C) 8%, an increase from the former 7% level
D) 9%

Question

Quizplus · Accepted Answer

An adjustment factor is used to convert a bond's yield to a different yield level. In this case, the adjustment factor is used to convert a T-bond to a bond yielding 6%, which is a decline from the former 8% level.

An Adjustment Factor Is Used to Convert a T-Bond to a Bond