The call premium of bond is $560 and the call price of bond is $340 then face value of the bond is _________?
Correct answer: B. $220
- A. $1.65
- B. $220
- C. $900
- D. $0.0165
Explanation
The call premium is the amount by which the call price exceeds face value, so face value equals $560 − $340 = $220. The figures are unusual because the stated premium exceeds the call price, but option b follows the intended arithmetic.
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