a-bond-with-a-face-value-of-1000-is-issued-at-950-what-does-this-indicate-about-

Question

A bond with a face value of $$1,000 is issued at 950. $$What does this indicate about the bond's stated interest rate compared to the market rate?

Accepted Answer

The stated rate is less than the market rate.

Answer

The bond is secured by collateral.

Answer

The stated rate is greater than the market rate.

Answer

The stated rate is equal to the market rate.

A bond with a face value of \$1,000 is issued at \$950. What does this indicate about the bond's stated interest rate compared to the market rate?