required rate of return
required option
required rate of redemption
required rate of earning
Answer is Right!
Answer is Wrong!
The correct answer is: A. required rate of return.
A bond is a fixed income instrument that represents a loan made by an investor to a borrower (typically corporate or governmental). The borrower issues bonds to raise money and agrees to pay the bond holders a fixed interest rate for a specified period of time until the loan is repaid. The required rate of return is the minimum rate of return that an investor expects to earn on a bond investment. It is determined by a number of factors, including the risk of the bond, the maturity of the bond, and the current market interest rates.
The other options are incorrect because:
- B. required option is not a term used in finance.
- C. required rate of redemption is the rate of interest that a bond issuer must pay to redeem a bond before its maturity date.
- D. required rate of earning is not a term used in finance.