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bonds Flashcards

1
Q

premium bond

A

bond issue above face value. stated>effective rate

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2
Q

discount bond

A

bond issue below face value. stated < effective rate

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3
Q

PV of the face

A

face * PV of a lump sum using the effective interest rate

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4
Q

PV of the interest

A

Fave * state rate * time= interest * PV of an ordinary annuity at the effective interest rate

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