A Bond with Face Value $1,000 That Sells for $1,000

question 236

Multiple Choice

A bond with face value $1,000 that sells for $1,000 in the market is called a ___________ bond.

• A) Par.
• B) Discount.
• C) Premium.
• D) Zero-coupon.
• E) Floating rate.

---

Definitions:

Average Rate of Return

A financial ratio that calculates the return, or profit, of an investment over a certain period as a percentage of the initial cost of the investment.

Economic Conditions

The state of a country's economy at a given time, influenced by factors such as GDP, unemployment rates, and inflation.

Liquidity

A company’s ability to convert assets into cash.

Straight-Line Depreciation

A method of calculating the depreciation of an asset which spreads the cost evenly over its estimated useful life.