A Consol Bond Is a Bond That

question 85

Multiple Choice

A consol bond is a bond that

• A) pays interest annually and its face value at maturity.
• B) pays interest in perpetuity and never matures.
• C) pays no interest but pays its face value at maturity.
• D) rises in value as its yield to maturity rises.

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Definitions:

Completed Unit

A unit of product that has completed the manufacturing process and is considered ready for sale or delivery to the customer.

Actual Rate

The real interest rate or exchange rate that is applied in current transactions, distinct from theoretical or future rates.

Standard Rate

A predetermined cost or price used in budgeting and costing exercises, reflecting an expected or agreed level of expenditure or charge.

Variable Factory Overhead Controllable Variance

The difference between the actual and budgeted variable overhead costs that management has the ability to influence or control.