Which equals the bond face value

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Reference no: EM131871517

1. A 12-year bond that hass a 12 percent coupon rate is currently selling for $1,000, which equals the bond's face value. If interest is paid semiannually, the bond's yield to maturity is

a. equal to 12 percent.

b. greater than 12 percent.

c. less than 12 perecnt.

d. More information is needed to answer this question.

e. None of the above is correct.

2. A bond with an annual coupon payment of $100 originally sold at par for $1,000. Market interest rates are currently 12%. This bond would be selling at a ____ in order to compensate ____.

a. premium; the purchaser for the below market coupon rate

b. discount; the purchaser for the below market coupon rate

c. discount; the seller for the below market coupon rate

d. premium; the seller for the below market coupon rate

Reference no: EM131871517

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