The call premium of bond is subtracted from call price of bond to calculate
Correct answer: A. face value of bond
- A. face value of bond
- B. face value of stock
- C. book value of stock
- D. book value of bond
Explanation
The call price equals the bond's face value plus the call premium, so subtracting the premium from the call price gives the face value. The other choices refer to stock or book value, which are unrelated here.
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