Which of the following statements regarding bonds and their terms is FALSE? A. The amount of each coupon payment is determined by the coupon rate of the bond. B. The zerominuscoupon bond has no periodic interest payments. C. Treasury bills are U. S. government bonds with a maturity of up to one year. D. Prior to its maturity date, the price of a zerominuscoupon bond is always greater than its face value.

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Business

Christopher Roth

4 May, 18:56

Which of the following statements regarding bonds and their terms is FALSE? A. The amount of each coupon payment is determined by the coupon rate of the bond. B. The zerominuscoupon bond has no periodic interest payments. C. Treasury bills are U. S. government bonds with a maturity of up to one year. D. Prior to its maturity date, the price of a zerominuscoupon bond is always greater than its face value.

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Jacey Cardenas · Answer 1

Answer: Prior to its maturity date, the price of a zerominus-coupon bond is always greater than its face value.

The above statement is false in regards with bonds and their terms.

Zerominus-coupon bondholders minutely get the face value of the bond when the coupon ages. Zerominus coupon do not issue interest payments. Therefore, the price of a zerominus-coupon bond is not always greater than its face value.

The correct option is (d).