Which of the following statements is true?
A) When investors' required rate of return equals the bond's coupon rate, then the market value of the bond may be selling at par value.
B) When investors' required rate of return exceeds the bond's coupon rate, then the market value of the bond will be greater than par value.
C) When investors' required rate of return is less than the bond's coupon rate, then market value of the bond will be greater than par value.
D) When investors' required rate of return is less than the bond's coupon rate, then the market value of the bond will be less than par value.
Answer: C
You might also like to view...
Which of the following situations would be considered a dual agency?
A. A salesperson and employing broker splitting a sales commission. B. Brokers from two offices splitting a sales commission. C. A broker acting for both the buyer and seller in the same transaction. D. A broker acting for the seller cooperating with another broker acting for the buyer.
Johnson Boats wants to introduce a new model of boat into mature markets in highly developed countries with the goal of quickly gaining mass-market share. As a consultant, you should recommend a ________ pricing strategy
A) skim B) penetration C) price leadership D) cost-plus E) captive