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hich one of the following is the reason that bonds may sell at a discount o

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 3Q: The rate of return on a bond held to its maturity date is called the bonds yield to maturity. If...

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Question

Which one of the following is the reason that bonds may sell at a discount or premium?

Select one:

a. Market conditions caused the coupon rate of interest to change between the time the bond agreement was written and the date the bonds were actually issued to investors

b. The bond issuer failed to consider the market yield rate when the bond agreement was created

c. The bond issuer adjusted the coupon rate to match that of other bond issues

d. The market yield rate fluctuated between the time the bond agreement was written and the date the bonds were actually issued to investors

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