Q220
Difference between face value of bond and call price of bond is considered as
A.
call premium
AnswerB.
call provision
C.
discount premium
D.
discount provision
Answer: Option A
Solution
Answer: Option A
Solution:
Difference between face value of bond and call price of bond is considered as call premium. Call premium is the dollar amount over the par value of a callable debt security that is given to holders when the security is redeemed early by the issuer.