If market interest rates are higher than the rate offered on the bonds being sold,they will be sold at

Question

Quizplus · Accepted Answer

If market interest rates are higher than the rate offered on the bonds being sold, investors will require a higher rate of return than the bond's coupon rate. This means the bond will be less attractive to investors and the bond issuer may need to sell it at a lower price (discount) in order to entice buyers.

If Market Interest Rates Are Higher Than the Rate Offered