15 the interest rate on which cash payments to bondholders are based is the a market 4306993
15) The interest rate on which cash payments to bondholders are based is the:
A) market rate.
B) discount rate.
C) stated rate.
D) amortization rate.
16) An instrument that matures at one specified time is known as a:
A) preferred share.
B) common share.
C) bond.
D) letter of credit.
17) Which of the following describes a serial bond?
A) a bond that repays principal in installments
B) a bond that gives the bondholder a claim for specific assets if the issuer fails to pay
C) a bond that matures at one specified time
D) a bond that is not backed by specific assets
18) Which of the following describes a secured bond?
A) a bond that repays principal in installments
B) a bond that gives the bondholder a claim for specific assets if the issuer fails to pay principal or interest
C) a bond that matures at one specified time
D) a bond that is not backed by specific assets
19) Which of the following describes a debenture?
A) a bond that repays principal in installments
B) a bond that gives the bondholder a claim for specific assets if the issuer fails to pay principal or interest
C) a bond that matures at one specified time
D) a bond that is not backed by specific assets
20) Which of the following statements is true of a bond that is issued at a discount?
A) It will be sold at par.
B) Its stated interest rate is higher than the prevailing market rate.
C) It will repay a lesser amount than the face value at maturity.
D) It will be sold for less than the face value.
21) Which of the following statements is true of a bond that is issued at a premium?
A) It will be sold above par.
B) Its stated interest rate is lower than the prevailing market rate.
C) It will repay a greater amount than the face value at maturity.
D) It will be sold at par.
22) If bonds with a face value of $200,000 are sold at 98, the amount of cash proceeds is:
A) $202,000.
B) $200,000.
C) $196,000.
D) $192,157.
23) If bonds with a face value of $200,000 are sold at par, the amount of cash proceeds is:
A) $202,000.
B) $200,000.
C) $196,000.
D) $192,157.
24) If bonds with a face value of $200,000 are sold at 105, the amount of cash proceeds is:
A) $209,523.
B) $200,000.
C) $190,476.
D
