A bond with a coupon rate of 6.5 percent and trading at $960 will pay annual interest of $62.40.

Name: A bond with a coupon rate of 6.5 percent and trading at $960 will pay annual interest of $62.40.
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Question

Quizplus · Accepted Answer

A bond with a coupon rate of 6.5 percent will pay annual interest based on its face value, not its trading price. If the face value is not given, it's typically assumed to be $1,000 for these types of problems, making the annual interest $65 (6.5% of $1,000).

A Bond with a Coupon Rate of 6