When Bonds Are Sold for Less Than the Face Amount

question 74

Multiple Choice

When bonds are sold for less than the face amount, this means that the:

• A) maturity value will be less than the face amount.
• B) maturity value will be greater than the face amount.
• C) bonds are sold at a premium.
• D) stated rate of interest is less than the market rate of interest.

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Definitions:

Puritans

A group of English Protestants in the 16th and 17th centuries who sought to purify the Church of England of Roman Catholic practices, maintaining that the Church of England was only partially reformed.

Anglicans

Members of the Church of England or of any churches in communion with it, which combine Catholic and Protestant traditions.

Petition of Right

A constitutional document submitted to Charles I by the English Parliament in 1628 to limit the king's authority and assert the rights of subjects, including freedom from arbitrary arrest and taxation without Parliament's consent.

English Constitution

An uncodified set of fundamental principles and established precedents according to which the state of England is governed.