All other things being equal, aA bond's value will be below its maturity value of $1,000 if it pays interest of $100 per year and investors require a rate of return that is of, all other things being equal:

Question

Quizplus · Accepted Answer

The bond's price will be discounted if the required rate of return, which represents the market's interest rate, is higher than the bond's coupon rate of 10%. Therefore, the bond's price will be lower than its face value (maturity value of $1,000), which indicates that the bond is selling at a discount.

All Other Things Being Equal, AA Bond's Value Will Be