Bonds with a lower interest rate than market will probably sell at a premium. I think that its true but i really dont understand bonds fully.True or false question about bonds and premiums?
Answer:
False
If coupon rate is lower than market rate, bond would sell at a discount.
Why? Why would you buy an investment that offers a return lower than the average market return. Same principle applies to bond sold at a premium.True or false question about bonds and premiums?
Try again.
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