The market interest rate related to a bond is also called the a.stated interest rate b.contract interest rate c.effective intere

Question

ELEN [110]

1 year ago

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The market interest rate related to a bond is also called the a.stated interest rate b.contract interest rate c.effective intere

st rate d.straight-line rate

Business

1 answer:

never [62] · Answer 1 · 2023-10-08T05:26:22+03:00

Answer:

The market interest rate related to a bond is also called the

c.effective interest rate.

Explanation:

Another name for the market interest rate is the current interest rate, the yield-to-maturity, or the effective interest rate. One distinguishing factor is that the market interest rate is always changing whereas the stated interest rate does not change. The stated interest rate is the interest rate actually designated on the face of a bond, which determines the amount of interest that the bondholder receives. This means that the market interest rate is just the rate that investors demand to earn for lending their money to the company.