Investors purchase corporate bonds for interest income, increase in value, and repayment at maturity. True or False?
Understand the Problem
The question is asking whether the statement that investors purchase corporate bonds for interest income, increase in value, and repayment at maturity is true or false.
Answer
True
The statement is True. Investors purchase corporate bonds for interest income, potential increase in value, and repayment of principal at maturity.
Answer for screen readers
The statement is True. Investors purchase corporate bonds for interest income, potential increase in value, and repayment of principal at maturity.
More Information
Investors are generally interested in the interest payments (coupon), potential capital gains if the bond's market price increases, and the return of the face value at maturity.
Tips
Confusing interest payments with guaranteed price increase; bond prices can fluctuate, but repayment is fixed upon maturity.
Sources
- true or false: investors purchase corporate bonds for interest income ... - webmail.oklahoma4.create.ou.edu
- What Are Corporate Bonds? | SEC.gov - sec.gov
- Corporate Bonds: Definition and How They're Bought and Sold - investopedia.com
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