Answer: B. will cause the total cost of borrowing to be less than the bond interest paid
Explanation:
It should be noted that when a bond is sold above the face value, this will result into the total cost of borrowings to be less than the bond Interest that was paid.
The reason for the above is due to the fact that the borrower will not be required to repay the bond premium when the bond matures at its maturity date.
Therefore, the correct option is B.
Answer:
All the answers are attached below. Thanks.
Explanation:
Answer:hahah
Explanation:u are so unsmart hahah lol
<span>The cell phone company is participating in strategic outsourcing. When a business uses strategic outsourcing they are outsourcing a part of their company operations to another company. By doing this, they are able to focus more on their core company goals and let another company handle the outside work of making it happen. </span>
Answer:
A zero coupon bond:
A. is sold at a large premium.
B. has a price equal to the future value of the face amount given a positive rate of return.
C. can only be issued by the U.S. Treasury.
D. has less interest rate risk than a comparable coupon bond.
E. has a market price that is computed using semiannual compounding of interest.
Answer is : B
Explanation:
In classification of bonds we have a unique type of bond known as Zero-coupon bonds also know as Pure discount bonds, unlike traditional bonds they don’t pay coupon instead they are sold on discount basis and on maturity the bondholder receive a par value, for this reason the price will be at a discount on sale and on maturity be redeemed at par price showing a positive rate of return.
