Which of the following are the main features of Zero Coupon Bonds?
1. They are called deep discount bonds.
2. The price paid by investors is less than their face value.
3. The bonds are redeemed at par.
A. 1 and 3
B. 1 and 2
C. 2 and 3
D. 1, 2 and 3
Answer: Option D
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Related Questions on Business Finance
The appropriate ratio for indicating liquidity crisis is
A. Operating ratio
B. Sales turnover ratio
C. Current ratio
D. Acid test ratio
A. Net present value method
B. Internal rate of return method
C. Profitablity index method
D. None of the above
A. a-4, b-3, c-1, d-2
B. a-3, b-4, c-1, d-2
C. a-4, b-3, c-1, d-2
D. a-3, b-2, c-4, d-1
Which one of the following assumptions is not included in the James E. Walter Valuation model?
A. All financing by retained earnings only
B. No change in the key variables such as EPS and DPS
C. The firm has finite life
D. All earnings are either distributed as dividends or invested internally immediately
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