Zack owns a bond that will pay him $35 each year in interest plus a $1,000 principal payment at maturity. The $1,000 principal payment is called the coupon. par value. discount. yield. call premium. None of the options are correct.

Question

Business

Kaylee Castaneda

23 April, 18:44

Zack owns a bond that will pay him $35 each year in interest plus a $1,000 principal payment at maturity. The $1,000 principal payment is called the coupon. par value. discount. yield. call premium. None of the options are correct.

+1

Answers (1)

Know the Answer?

Lesly Stephens · Answer 1

Par value

Explanation:

The reason for this answer is that, for Bonds, par value is an essential pricing benchmark. When the bond price is below the par value, the bond is selling ''at a discount'', When the bond price is above par value, he bond is selling at a premium,

Par value has little significance for equitis because it generally does not influence the stock price itself.

Par value is the face value of a bond, it is the principal amount that the lender (investor) is lending to the borrower (issuer).