what creates bond discounts ?
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The bond discount is the difference by which a bond's market price is lower than its face value. ... Bonds are sold at a discount when the market interest rate exceeds the coupon rate of the bond. To understand this concept, remember that a bond sold at par has a coupon rate equal to the market interest rate.
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1
Answer:
The bond discount is the difference by which a bond's market price is lower than its face value. ... Bonds are sold at a discount when the market interest rate exceeds the coupon rate of the bond. To understand this concept, remember that a bond sold at par has a coupon rate equal to the market interest rate.
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