Match the following:

Choose the correct answer from the options given below:

Correct option is D

The correct match is: A-IV, B-II, C-I, D-III

• A. Par Value → IV. Value on the face of the bond
  Par value is the face value of a bond, typically ₹1000, and is the amount repaid at maturity.

• B. Maturity Period → II. Number of years after which the value is payable to holders
  The maturity period refers to the duration after which the bond’s face value is paid back to the investor.

• C. Coupon Rate → I. Specified interest rate
  The coupon rate is the fixed annual interest rate stated on the bond, paid to bondholders.

• D. Premium → III. Amount by which a bond sells at a value higher than par value
  A bond is said to be sold at a premium if its price exceeds the par value.

Information Booster:

• Par Value is also known as the face value or nominal value. It remains constant throughout the bond's life.

• Maturity Period helps investors know the investment horizon and assess interest rate risks.

• Coupon Rate determines interest payments made periodically to bondholders.

• Premium Bonds occur when interest rates in the market fall and existing bonds with higher rates become more attractive.

• A bond priced above par value is considered to be sold at a premium; below par, it is at a discount.

• Bonds can be redeemable at maturity or callable (redeemable before maturity).

• The yield to maturity (YTM) takes into account the coupon payments, time to maturity, and any premium/discount in pricing.