Which of the Following Is Not True Regarding Zero-Coupon Bonds

question 12

Multiple Choice

Which of the following is not true regarding zero-coupon bonds?

• A)They are issued at a deep discount from par value.
• B)Investors are taxed annually on the amount of interest earned, even though the interest will not be received until maturity.
• C)The issuing firm is permitted to deduct the amortized discount as interest expense for federal income tax purposes, even though it does not pay interest.
• D)Zero-coupon bonds are purchased mainly for tax-exempt investment account, such as pension funds and individual retirement accounts.
• E)all of the above are true

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Definitions:

Race

A social construct used to categorize humans based on physical characteristics, such as skin color and facial features.

Diverse Workforce

A workforce that includes a wide range of differences among employees, such as cultural, racial, gender, age, and educational backgrounds, contributing to a variety of perspectives and ideas.

Competitive Advantage

A condition or circumstance that puts a company in a favorable or superior business position compared to its competitors.

Ethnocentrism

The tendency to judge other groups according to the standards, behaviors, and customs of one’s own group.