If a Bond Has a Contract Rate of Interest of 6

question 267

Multiple Choice

If a bond has a contract rate of interest of 6%, but the discount rate of interest is 8%, the bond

• A) will sell at a discount (less than face value).
• B) will sell at a premium (more than face value).
• C) may sell at either a premium or a discount.
• D) will sell at its face value.

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Definitions:

Congruent

In psychology, referring to consistency and alignment between an individual's self-perception and actual experiences or behaviors.

Environment

The surrounding conditions, influences, or forces which affect the life, behavior, or development of an organism or community.

Innate Tendency

An inherent inclination or natural disposition in organisms to behave in a certain way.

Human Nature

The inherent characteristics, including ways of thinking, feeling, and acting, that all humans share.