A bond will sell at its par value when the market rate of interest equals the coupon rate of interest.

Name: A bond will sell at its par value when the market rate of interest equals the coupon rate of interest.
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Question

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When the market rate of interest equals the coupon rate of interest, it means that the bond's yield to maturity is equal to the coupon rate. This makes the bond more attractive to investors and hence it will sell close to its par value.

A Bond Will Sell at Its Par Value When the Market