If a bond has a stated rate of 10% and is discounted at 10%, then the proceeds received at issuance will be
A) equal to the face value of the bonds.
B) greater than the face value of the bonds.
C) less than the face value of the bonds.
D) zero.

Question

Quizplus · Accepted Answer

If the stated rate of the bond and the discount rate are the same, the bond will be issued at face value. Therefore, the proceeds received at issuance will be equal to the face value of the bonds.

If a Bond Has a Stated Rate of 10% and Is