What is the difference between face rate and market rate, and which rate would be higher if a bond is issued at a discount?

Q: What does a bond issue's "call" feature entail? What effect does the call feature have on bond…

A: This question deals with the "call" feature of a bond issuance entails and the call feature's effect…

Q: If you know the par value of bonds, the contract rate, and the market rate, how do you compute the…

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Q: what does the bond rating depend on?

A: It is a credit rating which represents the creditworthiness of both the corporate and the government…

Q: If interest rates in the financial markets increase after a bond is issued, what will happen to the…

A: A bond is an instrument that represents the loan that is made by the investor to the company and…

Q: What is the excess of the issue price of bonds over their face amount called? premium discount…

A: Premium on Bonds: When bond market costs higher than its face value then bonds is called at premium.…

Q: Why does the yield on a discount bond surpass the coupon rate

A: Introduction:The bond will trade at a discount if the yield to maturity (YTM) exceeds the coupon…

Q: In response to how the sales incentives might be contributing to falling profits despite growing…

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Q: In general, how is the rate on a floating-rate bond determined?

A: The bond that changes in interest entirety in line with market interest rates or a few other…

Q: Why is the required rate of return on a bond different than the copoun rate

A: Bonds are the debt securities which are issued by the corporates or the government to raise the…

Q: How do you calculate the price of bonds if you have the par value, contract rate, and market rate

A: This question teals about If you know the par value, contract rate, and market rate of bonds, you…

Q: How do you calculate the price of bonds if you know their par value, contract rate, and market rate

A: This question dells with  a bond's price if you know its par value, contract rate, and market rate

Q: What effect does collateral have on a bond's interest rate? What effect does subordination have on a…

A: There are various factors that impact a bond's price. We discount back the future cash flows of a…

Q: What role do interest rates have in the value of bonds? What are the fundamental assumptions that go…

A: Introduction: Bonds are a kind of debt owed by the corporation that must be paid back. Coupon…

Q: How do interest rates affect bond valuations? What are the key assumptions in valuing a bond?

A: Bonds are the form of debt payable by the company. Interest rates on bonds to be paid is coupon…

Q: When a bond is issued, what is its present value?

A: The present value of the bond is the total of the present value of the bond's interest payments that…

Q: What are the contract rate and the market rate for bonds?

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Q: Why is the discount and premium on bond issues amortized?

A: The bonds can be issued at premium or discount on the basis of market rate of similar bonds.

Q: What is the stated rate for a bond?

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Q: How do we calculate the issue price of bonds? Is it equal to the present value of the principal?…

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Q: if the market rate of interest is lower than the stated rate, bonds will sell at an amount ?

A: Solution: if the market rate of interest is lower than the stated rate, then bond will sell at an…

Q: What is the link between the level of interest rates and the price of bonds? Why is it necessary for…

A: Introduction: Bonds are a sort of long-term debt that governments and enterprises often issue to…

Q: What exactly is a bond's "call" feature? What impact does the call feature have on bond premium or…

A: This question explains about a bond's "call" feature the call feature have on bond premium or…

Q: How does the carrying value of a bond gets amortized when selling it at discount?

A: The carrying value of bond represents the amount of Bond Face Value + unamortized premium (or )–…

Q: What is new issue bond?

A: The bond is a fixed income financial instrument that is issued by the government or by the companies…

Q: How is the price determined for a bond (or bond issue)?

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Q: what is difference between a bond and a term loan? what are the advantages of a term loan over a…

A: A bond is a fixed-income security that speaks to credit to a borrower (normally corporate or…

Q: Which of the maturity lengths between the bonds, bills, and notes would be most advantageous during…

A: Bear market is the market condition when it drops off 20% or more than market average. It occurs…

Q: Why is it necessary to amortize the discount and premium on bond issues?

A: Introduction:   Bonds may be sold at a discount, at a premium, or at face value.

Q: Discuss how the duration of a bond's maturity affects the link between market interest rates and the…

A: This question explains about the duration of a bond's maturity affects the link between market…

Q: How is the Equivalence Calculations made with Effective Interest Rates?

A: The formula for Effective annual rate is  Where, r - rate of return n - number of compounding.…

Q: What are bond issue costs? What is an underwriter?

A: Bonds: Bonds are a kind of interest bearing notes payable, usually issued by companies, universities…

Q: What does it mean to amortize a bond premium or discount? Why is it necessary?

A: Introduction: A bond is a contract between the bond lender and the bondholders. The two most common…