If the interest rate on a bond is 9% and the market interest rate is 8%; the bond will be issued at a price above the par value of the bond.

Question

Quizplus · Accepted Answer

When the interest rate on a bond is higher than the market interest rate, the bond will be issued at a price above the par value of the bond. This is because investors are willing to pay a premium for a bond that offers a higher interest rate than the market rate.

If the Interest Rate on a Bond Is 9% and the Market