Home › B.Com Banking & Insurance › Financial Management › Bonds and Bond Valuation › The rate used to work out the periodic interest …
The rate used to work out the periodic interest payments on a bond is the:
ACarrier rate
BCoupon rate
CCustom rate
DCounter rate
Answer & Solution
Correct answer: B. Coupon rate
1. It is always stated in annual terms.
2. Payments may still be more frequent.
3. It is the coupon rate.
_Source: OpenStax Principles of Finance 2e, Chapter 10, Bonds and Bond Valuation._
Related questions
The yield column of a bond table shows the return an investor gets if the bond is:Coupon rates are always expressed in which terms, even when payments are more frequent?If a 1,000 par bond pays 6% annually in two equal instalments, each payment is:A bond paying 5% on a par value of 1,000 makes an annual coupon payment of:A bond paying 8% on a par value of 1,000 makes an annual coupon payment of:Because bonds are fixed-income investments, they are exposed to risks that can hurt their:Investment-grade bonds are especially popular because many commercial banks and pension fuBonds in the top rating bands are described as: