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Whitepunk [10]
3 years ago
9

A regular way municipal bond trade takes place on Tuesday, August 13. Interest payment dates for the bond are February 15 and Au

gust 15. Which of the following statements are true? I. Settlement occurs prior to the interest payment date. II. Settlement occurs on the interest payment date. III. Accrued interest must be paid by the buyer. IV. No accrued interest will be paid by the buyer. (A) I and III (B) I and IV (C) II and III (D) II and IV
Social Studies
1 answer:
Monica [59]3 years ago
8 0

Answer:

(D) II and IV

Explanation:

Usually, the municipal trade are finished in three business days after the day the trade was made, the accumulated interest is paid too but it does not include the day the trade was finished.

Therefore, the trade will be finished by the date of the 15th, since the trade settles on the interest payment date and interest is paid up to but not including settlement, the interest will not be accumulated.

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Explanation:

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