The principal amount of a bond at issue is called____________?
Correct answer: A. Par value
- A. Par value
- B. Coupon value
- C. Present value of an annuity
- D. Present value of a lump sum
Explanation
Par value is the face or principal amount stated on a bond and is generally the amount repaid at maturity. The coupon value refers to the bond's interest payment or rate, not its principal.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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