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Which of the following are included on a bond certificate?

a. market interest rate
b. None of the choices are correct.
c. discount rate
d. maturity date

User Shubhendu
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2 Answers

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Final answer:

The correct answer is option d. On a bond certificate, the maturity date is included alongside the face value and the coupon rate or interest rate. Market interest rate and discount rate are not found on the bond certificate, but they can affect the bond's present value. The correct answer to the question is the maturity date.

Step-by-step explanation:

A bond certificate is a financial instrument that indicates the debt obligation by the issuer towards the bondholder and contains various pieces of information about the terms of the bond. The information typically included on the certificate comprises the face value (the principal amount the issuer will repay the investor at maturity), the coupon rate or interest rate (the return the investor will get on their money, usually paid semi-annually), and the maturity date (the specific date on which the issuer is due to repay the face value and make the final interest payment to the bondholder).

It is important to understand that market interest rates are not printed on the bond certificate, but they do influence the present value (current market value) of a bond. A bond could be traded at a discount or premium to its face value based on the current market interest rates compared to the bond's coupon rate. However, the discount rate is not initially a part of a bond certificate but might be used later by investors to determine the present value of the bond during its life.

The correct answer to which of the following are included on a bond certificate is: d. maturity date.

User Bdeonovic
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1 vote

Final answer:

A bond certificate includes the bond's face value, coupon rate or interest rate, and maturity date. Market interest rate influences a bond's present value but is not printed on the bond certificate.

Step-by-step explanation:

The items that are included on a bond certificate are the face value (the amount the borrower agrees to pay the investor at maturity), the coupon rate or interest rate, and the maturity date. The market interest rate is not printed on the bond certificate, but it is a vital factor considered by investors when determining the present value of a bond, which is the most they would be willing to pay for it. The present value can differ from the bond's face value, depending on the prevailing market interest rates at the time of bond evaluation.

User Robin Cox
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