Maturity value minus the discount amount is called the
A) discount.
B) proceeds.
C) principal.
D) maturity value.

Question

Quizplus · Accepted Answer

The maturity value is the amount that the bond will be worth at the end of its term, and the discount amount is the amount by which the bond is sold for less than its face value. The proceeds are the amount of money that the issuer receives from the sale of the bond, which is equal to the face value of the bond minus the discount amount. Therefore, the maturity value minus the discount amount is equal to the proceeds.

Maturity Value Minus the Discount Amount Is Called the