Suppose a Government of Canada bond is being offered in financial markets at a price that is higher than its present value.We can expect that

Question

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If the bond is being offered at a price higher than its present value, it means the demand for the bond is low. As a result, the price of the bond is likely to fall as sellers will need to reduce the price in order to attract buyers. The face value of the bond is unlikely to be adjusted as it is a fixed value determined at the time of issuance. The relatively high demand for the bond causing its present value to rise is not a plausible explanation, as the situation described implies low demand.

Suppose a Government of Canada Bond Is Being Offered in Financial