The cash received from interest equals the face value of the investment in bonds times the stated interest rate.

Question

Quizplus · Accepted Answer

This statement is true. The calculation for cash received from interest is simply the face value of the investment multiplied by the stated interest rate. For example, if an investor purchases a $1,000 bond with a 5% interest rate, the cash received from interest would be $50 per year.

The Cash Received from Interest Equals the Face Value of the Investment