SIE (Securities Industry Essentials) Practice Exam

Question: 1 / 400

A bond last sold at 102. This indicates that the bond is selling at:

a discount

face value

a premium

The bond selling at 102 indicates that it is selling at a premium. This means that the bond is being sold at a higher price than its face value, indicating that investors are willing to pay more for it. A bond selling at a premium typically has a higher coupon rate or longer maturity date. The other options are incorrect because a bond sold at a discount would have a price below 100, while a bond sold at face value or par would have a price exactly at 100. Additionally, a bond sold at face value would mean that the coupon rate and market interest rate are the same, and a bond sold at par would indicate that the coupon rate is equal to the current market interest rate.

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