Asked by Ahmad Ahmadzai on May 12, 2024
Verified
A bondholder that owns a $1,000,10%,10-year bond has:
A) Ownership rights in the issuing company.
B) The right to receive $10 semiannually until maturity.
C) The right to receive $1,000 at maturity.
D) The right to receive $10,000 at maturity.
E) The right to receive dividends of $1,000 per year.
Bondholder
An investor or institution that owns bonds issued by a corporation or government, entitling them to receive fixed interest payments and the return of principal at maturity.
Maturity
Maturity refers to the date on which the principal or face value of a financial instrument, such as a bond or loan, becomes due and payable.
- Acquire knowledge of the elementary concepts and categories of bonds, including callable bonds and debentures.
- Understand the mechanics and implications of bond pricing, including discounts, premiums, and amortization methods.
Verified Answer
SZ
Steve ZangwaMay 16, 2024
Final Answer :
C
Explanation :
Bondholders have the right to receive the face value of the bond at maturity, which in this case is $1,000.
Learning Objectives
- Acquire knowledge of the elementary concepts and categories of bonds, including callable bonds and debentures.
- Understand the mechanics and implications of bond pricing, including discounts, premiums, and amortization methods.