- This topic has 3 replies, 2 voices, and was last updated 12 years ago by
.
Viewing 4 posts - 1 through 4 (of 4 total)
- Posts
Is interest paid on deep disc bonds?and as it cannot be issued at a discount to nominal vlues,is it more than $100?
Yes, but very low interest.
Bonds can be issued at a discount to nominal value (it is shares that cannot be).
So that is why the interest is very low. If you issued $100 bonds at only $60 (a big discount) but repayable at the full $100, then there is such a big gain on repayment that the investor will accept a very low rate of interest.
But in the bpp kit it says bonds cannot be issued at a discount due to which I was confused
Viewing 4 posts - 1 through 4 (of 4 total)
- You must be logged in to reply to this topic.