Which of the following statements is TRUE?
A)A coupon bond is a pure discount bond.
B)Prior to its maturity date,the price of a zero-coupon bond is always greater than its face value.
C)The simplest type of bond is a coupon bond.
D)Treasury bills are Government of Canada bonds with a maturity of up to 10 years.
E)The amount of each coupon payment is determined by the coupon rate of the bond.

Question

Quizplus · Accepted Answer

The amount of each coupon payment of a bond is indeed determined by the bond's coupon rate, which is a fixed percentage of the bond's face value. This is a fundamental principle of how bonds work, making statement E true.

Which of the Following Statements Is TRUE