If Market Interest Rates Fall After a Bond Is Issued,the

question 84

Multiple Choice

If market interest rates fall after a bond is issued,the:

• A)investor will sell the bond.
• B)face value of the bond increases.
• C)market value of the bond is decreasing.
• D)market value of the bond is increasing.

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Definitions:

Maturity Date

The date on which a financial obligation must be repaid or a bond or other instrument reaches its expiration and the principal is due back to the investors.

Note Receivable

A claim or debt that one party owes to another under the terms of a promissory note, indicating money to be received.

Perpetual Inventory System

An inventory management system where records of inventory quantities are updated on a continuous basis as transactions occur.

Journal Entries

Records of financial transactions in the order in which they occur, used to transfer information to the ledger accounts.