Considerations in issuing a coupon bond compared to a zero coupon bond. Zero Coupon Bonds: Zero coupon bonds are financial instruments which are traded at discount and do not render any interest payments to the bondholder. It is traded at less than its face value with yielding any periodic payments of interest. And thus, generates yield at its maturity.

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Chapter 8, Problem 4MC

Summary Introduction

To identify: Considerations in issuing a coupon bond compared to a zero coupon bond.

Zero Coupon Bonds:

Zero coupon bonds are financial instruments which are traded at discount and do not render any interest payments to the bondholder. It is traded at less than its face value with yielding any periodic payments of interest. And thus, generates yield at its maturity.

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