Question
The principle am punt (face value)of a bond Coupon Rate Moturity Pot Value Yield
Answer
4
(270 Votes)
Elodie
Master · Tutor for 5 years
Answer
Among the options given, the principle amount (face value) of a bond out of these options is clearly defined as Par Value; hence the suitable response will be 'Par Value'.
Explanation
## Step1: Understand the terminology used in the given bond question. Principle amount, which is also known as Face Value and Par Value, is the amount a bond issuer promises to pay to a bond holder when the bond matures. ## Step2: Identifying accurate information from the given options: 1. Coupon Rate: This refers to the annual interest percentage the bondholder receive from the bond issuer. 2. Maturity: This denotes the final date on which the principal amount of a bond is paid to the bondholder and hence the bond life ended. 3. Par Value: Known as Face Value in our context indicates the nominal or face amount that will be returned to the bondholder at maturity. 3. Yield: Reflects the rate of return of the bond annually.