单选题

Which of the following is most likely a limitation of the yield-to-maturity measure?

【正确答案】 B
【答案解析】

B is correct because yield to maturity does consider reinvestment income; however, it assumes that the coupon payments can be reinvested at an interest rate equal to the yield to maturity. This is one of the limitations for the yield-to-maturity measure because the investor is facing re-investment risk (future interest rates will be less than the yield to maturity at the time the bond is purchased).