The correct answer is False , The present value of the face amount due at maturity plus the present value of the monthly interest payments make up the bond's price.
The coupon rate is the same as the current yield. For a certain coupon rate, the yield to maturity has an inverse relationship with bond price.
As a result, when the yield to maturity is the same as the coupon rate, the price of a bond is equal to its face value.
Here is a presentation of the bond value formula: Price = (Coupon 1 + (1 + r) + (1 + r) Par Value Price equals (Coupon 1 (1 + r) n r) + Par Value (1 + r) n, where: Coupon is the cash flow received before the par value for each intermediate payment.
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