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What is the relationship between expected return and yield

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Question - Canyon Buff Enterprise just issued a three-year, zero-coupon corporate bond at a price of $74. You have purchased this bond and intend to hold it until maturity. If you expect that the bond issued by Canyon Buff Enterprise may default with a probability of 30%. What is the relationship between the expected return and the yield to maturity?

Expected return = Yield to Maturity

Expected return > Yield to Maturity

Expected return < Yield to Maturity

Cannot be determined

Reference no: EM132995770

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