On the date of initial issuance of a financial instrument , the market value will equal
A)the initial issue proceeds [the amount borrowed].
B)the sum of the future cash flows.
C)the maturity value of the instrument.
D)the par value of the instrument.
E)the par value of the instrument minus the premium or plus a discount.

Question

Quizplus · Accepted Answer

The market value of a financial instrument at the time of its initial issuance typically equals the initial issue proceeds, which is the amount borrowed or raised from investors. This is because the issue price is set to reflect the current market conditions and investor demand.

On the Date of Initial Issuance of a Financial Instrument