Asked by
Tshegofatso Sebeela Tshego
on Nov 04, 2024Verified
The invoice price of a bond that a buyer would pay is equal to
A) the asked price plus accrued interest.
B) the asked price less accrued interest.
C) the bid price plus accrued interest.
D) the bid price less accrued interest.
E) the bid price.
Invoice Price
The initial price that the manufacturer suggests the retailer to sell their product for, before any adjustments like discounts or rebates.
Accrued Interest
Interest that has been incurred but not yet paid or received, often relevant in bond investments and loans.
Asked Price
The minimum price a seller is willing to accept for an asset or security.
- Appreciate the determinants of bond prices and yields.
- Interpret the implications of accrued interest in bond transactions.
Verified Answer
MJ
Learning Objectives
- Appreciate the determinants of bond prices and yields.
- Interpret the implications of accrued interest in bond transactions.