Prior to its maturity date, the price of a zero-coupon bond is its face value.

Name: Prior to its maturity date, the price of a zero-coupon bond is its face value.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Prior to its maturity, the price of a zero-coupon bond will be less than its face value because the investor is not receiving any interest payments. As the bond approaches its maturity date, the price will gradually increase towards its face value.

Prior to Its Maturity Date, the Price of a Zero-Coupon