Final answer:
The weighted average number of years to the receipt of the principal and interest payments that will result in the realization of the initial market discount rate on a bond is best described as the duration of the bond.
Step-by-step explanation:
The weighted average number of years to the receipt of the principal and interest payments that will result in the realization of the initial market discount rate on a bond is best described as the duration of the bond.
The duration of a bond measures its sensitivity to changes in interest rates. It takes into account both the time to receipt of the principal and interest payments, as well as the present value of those payments at different time periods.
To calculate the duration of a bond, you would need to determine the present value of each cash flow (principal and interest payments) and weight them by their respective time periods. The weighted average of these time periods gives you the bond's duration.