When the Effective-Interest Method Is Used to Amortize Bond Premium

question 50

Multiple Choice

When the effective-interest method is used to amortize bond premium or discount, the periodic amortization will

• A) increase if the bonds were issued at a discount.
• B) decrease if the bonds were issued at a premium.
• C) increase if the bonds were issued at a premium.
• D) increase if the bonds were issued at either a discount or a premium.

---

Definitions:

Productive Resources

Includes the inputs used in the production of goods and services, such as labor, capital, and natural resources.

Per Capita Water Use

The average amount of water consumed per person in a given area or community within a specified time period.

Demographic Transition

A model describing the transformation of a country from high birth and death rates to low birth and death rates as it develops economically, leading to a stable population size.

Birthrates

The number of live births per thousand people in a population over a given period of time.