Asked by albandari aljuaid on Jul 08, 2024
Verified
A bond with face value $1,000 that sells for $1,000 in the market is called a ___________ bond.
A) Par.
B) Discount.
C) Premium.
D) Zero-coupon.
E) Floating rate.
Par Bond
A bond issued at its face value, where the purchase price is equal to the nominal or face value of the bond.
Market
A venue or system where buyers and sellers engage in the exchange of goods, services, or financial instruments.
Face Value
The nominal or dollar value printed on a bond, bill, or other financial instrument, representing the amount to be repaid at maturity.
- Acquire knowledge about the link between a bond's face value, its market valuation, and maturity considerations.
Verified Answer
AC
ayesha cobbinsJul 14, 2024
Final Answer :
A
Explanation :
A bond that sells for its face value in the market is referred to as a par bond. This means the market price is equal to the bond's face value.
Learning Objectives
- Acquire knowledge about the link between a bond's face value, its market valuation, and maturity considerations.