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133
What is the quoted discount rate on a money market instrument?
A.The interest rate earned as a percentage of the final face value of a bond
B.The interest rate earned as a percentage of the initial price of a bond
C.The interest rate earned as a percentage of the average price of a bond
D.The risk-free rate used to calculate the present value of future cash flows from a bond
A.The interest rate earned as a percentage of the final face value of a bond
B.The interest rate earned as a percentage of the initial price of a bond
C.The interest rate earned as a percentage of the average price of a bond
D.The risk-free rate used to calculate the present value of future cash flows from a bond
Answer: A
The quoted discount rate is the interest earned as a percentage of the final face value
The quoted discount rate is the interest earned as a percentage of the final face value
Flashcard info:
Author: CoboCards-User
Main topic: Finance & Investment
Topic: Derivatives
Published: 27.10.2015