To Have a Binding Contract, Which of the Following Is

question 17

Multiple Choice

To have a binding contract, which of the following is a necessary element?

• A)Mutual assent
• B)Capacity
• C)Both a and b
• D)None of the above

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Definitions:

Bond Prices

The cost at which a bond is trading, which can fluctuate based on interest rates, the bond's credit quality, and other factors.

Coupon Rate

The per annum interest rate of a bond, depicted as a percentage of its principal amount.

Zero-Coupon Bond

A financial instrument that pays no regular interest, sold at a significant discount and redeemed for its full face value at maturity.

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to changes in interest rates, often used to estimate the price's volatility.