The Interest Rate on a Bond Is

question 106

Multiple Choice

The interest rate on a bond is

• A) the difference between the face value and the bond price, expressed as a percentage of the face value.
• B) the difference between the face value and the bond price, expressed as a percentage of the bond price.
• C) the ratio of the face value and the bond price, expressed as a percentage.
• D) the difference between the face value and the yield, expressed as a percentage of the bond price.

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Definitions:

CRA

Canada Revenue Agency; responsible for administering tax laws for the Government of Canada and for most provinces and territories.

Depreciate

The process of allocating the cost of a tangible asset over its useful life, reflecting its decrease in value over time.

Cash Flow From Assets

The total amount of money being transferred into and out of a business, especially affecting the operational activities involving its assets.

Operating Cash Flow

Cash generated from a company's normal business operations.