A corporate bond is listed in the Wall Street Journal and shows an ask price of 98.62. If the corporate bonds have a par value of $1,000, what dollar amount should a buyer expect to pay?

A) $98.62
B) $986.20
C) $1,000.00
D) $1,081.25
E) $1,140.40

Question

Hamit Büyükgüzel · Accepted Answer

Final Answer : B, Explanation :  The ask price of 98.62 means that the bond is priced at 98.62% of its par value. Since the par value is $1,000, the cost to buy the bond would be 98.62% of $1,000, which is $986.20.

A corporate bond is listed in the Wall Street Journal and shows an ask price of 98.62. If the corporate bonds have a par value of $1,000, what dollar amount should a buyer expect to pay?

A) $98.62
B) $986.20
C) $1,000.00
D) $1,081.25
E) $1,140.40

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Learning Objectives

Related questions

A corporate bond is listed in the Wall Street Journal and shows an ask price of 98.62. If the corporate bonds have a par value of $1,000, what dollar amount should a buyer expect to pay?A) $98.62B) $986.20C) $1,000.00D) $1,081.25E) $1,140.40

Definitions

Learning Objectives

Learning Objectives

Related questions

A corporate bond is listed in the Wall Street Journal and shows an ask price of 98.62. If the corporate bonds have a par value of $1,000, what dollar amount should a buyer expect to pay?

A) $98.62
B) $986.20
C) $1,000.00
D) $1,081.25
E) $1,140.40