In bond terminology, the date when the principal is paid to the bondholder is called

Study for the Bachelor of Business and Economics (BBE) Entrance test. Focus on Math with flashcards and multiple choice questions, each accompanied by hints and explanations. Prepare effectively for your exam!

Multiple Choice

In bond terminology, the date when the principal is paid to the bondholder is called

Explanation:
The date when the principal is paid back to the bondholder is called the maturity date. At maturity, the issuer repays the bond’s face value (the principal), marking the end of the bond’s term. Before that final date, you typically receive periodic interest payments on coupon dates. The issue date is simply when the bond is first issued, and yield relates to return rather than a payment date. So the principal repayment happens at maturity.

The date when the principal is paid back to the bondholder is called the maturity date. At maturity, the issuer repays the bond’s face value (the principal), marking the end of the bond’s term. Before that final date, you typically receive periodic interest payments on coupon dates. The issue date is simply when the bond is first issued, and yield relates to return rather than a payment date. So the principal repayment happens at maturity.

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