Which of the Following Is Not Needed in Calculating the Value

question 161

Multiple Choice

Which of the following is not needed in calculating the value of a bond?

• A)Face interest rate
• B)Market interest rate
• C)Future value of periodic interest payments
• D)Present value of face (maturity)amount

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Definitions:

Premium Bond

A bond sold at a price higher than its face value, typically because it offers interest rates higher than the current market rates.

Discount Bond

A bond sold for less than its face value, where the difference between the purchase price and the face value represents the investor's return.

Registered Form

A security that is registered in the issuing corporation's books in the name of the owner, requiring transfer through formal procedures.