The discount rate used to value a bond is [blank].

Question

Quizplus · Accepted Answer

The discount rate used to value a bond is the market rate of interest, which represents the rate of return that investors demand for lending their money. This rate is not fixed and can vary based on factors such as inflation, economic conditions, and the creditworthiness of the issuer. The coupon interest rate, on the other hand, is the fixed interest rate paid by the issuer to bondholders and does not determine the value of the bond. The issuing company also does not determine the discount rate used to value the bond.

The Discount Rate Used to Value a Bond Is [Blank]