In order to measure the carrying value of investments in bonds, which of the following time value of money concepts is used?
A) the present value of an ordinary annuity
B) the future value of a single sum
C) the future value of an ordinary annuity
D) all of these

Question

Quizplus · Accepted Answer

The carrying value of investments in bonds is typically measured using the present value of an ordinary annuity. This is because bonds usually involve a series of fixed payments (interest) plus the repayment of the principal amount at maturity, both of which are discounted back to their present value to determine the bond's current worth or carrying value.

In Order to Measure the Carrying Value of Investments in Bonds