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Financial Planner

Category - Investment Planning

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What measurement does not include any reinvestment income or price appreciation or depreciation?

Current Yield
After-tax Return
Yield to Call
Yield to Maturity

Explanation

Answer: A - Current yield is a measurement that does not include any reinvestment income or price appreciation or depreciation. The current yield considers only the coupon component of bonds. The current yield is annual coupon payment divided by the price of bond. It is important to investors interested in income. Those investors who want high yearly income want bonds with a high current yield.

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