Respuesta :
When a bond is issued for more than its face value, the market rate of interest is less than the interest rate stated on the bond.
- The term "face value" refers to a security's nominal or monetary value; the issuing party specifies the face value.
- A stock's face value is its initial purchase price, as stated on the stock's certificate; a bond's face value is the amount that will be paid to the investor when the bond matures.
- Face value is not a reliable indicator of a stock's or a bond's actual market value because there are numerous other influencing factors, such as supply and demand, at work.
- When investing in bonds, face value (also known as par value) refers to the sum that, provided the bond issuer doesn't default, is paid to a bondholder when the bond matures.
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