As an outstanding bond approaches maturity, the price of the bond will always trend toward par value until, at maturity, the bond is worth its face value.

Question

Quizplus · Accepted Answer

This statement is true. As a bond approaches maturity, the price will converge toward its par value, which is typically the face value or principal amount of the bond. At maturity, the bond will be worth its face value.

As an Outstanding Bond Approaches Maturity, the Price of the Bond