Answer:
D. The bond will be issued at an amount above face value
Step-by-step explanation:
A premium bond trades at a price above its face value. For example, if the face value of a bond is $5000, but it is selling at a price above $5000, then it is a premium bond. At maturity, a bond bought at a premium will be paid the face value and not the premium value.
Bond's interest rates are constant until maturity. Demand for a particular bond may drive its price higher. If investors expect the interest returns from the bond to be higher than the market interest payments, such a bond will trade at a premium.
The bond that sells at a lower price than the face value is discount bond.