Coupon payment is calculated with help of interest rate, then this rate considers as________?
Correct answer: C. Coupon interest
- A. Payment interest
- B. Par interest
- C. Coupon interest
- D. Yearly interest rate
Explanation
The rate used to compute a bond’s periodic coupon payment is its coupon interest rate, applied to the bond’s par value. It is distinct from the market-required rate of return, which determines the bond’s price.
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