In the case of a bond, the only contractual factor is the amount of interest payments, as beginning and ending bond prices are determined by market forces.

Name: In the case of a bond, the only contractual factor is the amount of interest payments, as beginning and ending bond prices are determined by market forces.
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Question

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The price of a bond is determined by the market, not by the contractual terms of the bond. The contractual terms only specify the amount of interest payments that will be made.

In the Case of a Bond, the Only Contractual Factor