If the Required Rate of Return on a Bond (R_d)

question 54

True/False

If the required rate of return on a bond (r_d) is greater than its coupon interest rate and will remain above that rate, then the market value of the bond will always be below its par value until the bond matures, at which time its market value will equal its par value.(Accrued interest between interest payment dates should not be considered when answering this question.)

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Definitions:

Repression

A defense mechanism where unwanted or discomforting thoughts and memories are unconsciously pushed from the conscious mind.

Denial

A defense mechanism whereby individuals refuse to acknowledge reality or facts, often as a way to protect themselves from uncomfortable emotions or truths.

Stealing Money

The act of unlawfully taking money that belongs to someone else, with the intent to permanently deprive the owner of it.