Which statement best describes a characteristic of a bond?
A) The maturity of a bond refers to the amount to be paid back.
B) The principal of the bond refers to the person buying the bond.
C) A bond buyer cannot sell a bond before it matures.
D) The interest paid by a bond depends on its price.

Question

Quizplus · Accepted Answer

The interest paid by a bond is determined by its coupon rate, which is a fixed percentage of the face value of the bond. This means that the interest paid does not depend on the price of the bond, but rather the face value.

Which Statement Best Describes a Characteristic of a Bond