Asked by Alexandra Rosen on Jul 14, 2024
Verified
The principal amount of a bond that is repaid at the end of the loan term is called the bond's:
A) Coupon.
B) Face value.
C) Maturity.
D) Yield to maturity.
E) Coupon rate.
Face Value
The nominal or dollar value printed on a financial instrument like a bond or stock certificate, representing the amount to be repaid at maturity.
Principal Amount
The original sum of money borrowed in a loan, or invested, upon which interest is calculated.
Loan Term
The length of time over which a loan agreement is scheduled to be repaid.
- Gain insight into the interplay between bond face value, market value, and maturity factors.
Verified Answer
AC
Anthony CastaldiJul 16, 2024
Final Answer :
B
Explanation :
The face value of a bond is the principal amount that is repaid to the investor at the end of the loan term. It is also commonly referred to as the "par value."
Learning Objectives
- Gain insight into the interplay between bond face value, market value, and maturity factors.