Hi
Are zero coupon bonds issued at a discount on their redemption value or on their nominal value? In your notes, it's issued at a discount on their nominal value but in the examiner's answer, I found that he wrote redemption value. This is a confusion if you can help me with.
Thank you.
Shamaun
Ask the Tutor ACCA FM
Zero coupon bonds
11y ago#1Zero coupon bonds are either issued at a discount, or are repaid at a premium.
(The end result is effectively the same - you get no interest each year, but there is a big gain made on redemption)
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