Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

Finra Exam Series-7 Topic 4 Question 109 Discussion

Actual exam question for Finra's Series-7 exam
Question #: 109
Topic #: 4
[All Series-7 Questions]

An excerpt from a recent tombstone ad reveals bonds offered publicly at 101.

Why were they priced at a premium?

Show Suggested Answer Hide Answer
Suggested Answer: C

premium. That's the term for the option cost.


by Deonna at Mar 22, 2025, 03:18 AM

Limited Time Offer

25%

Off

Get Premium Series-7 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel
Glendora
1 months ago
Haha, I bet the tombstone ad writer was just trying to sound fancy. 'Bonds offered publicly at 101' - they're really not fooling anyone!
upvoted 0 times
Tequila
1 days ago
C) to provide the issuer with a larger deduction from pre-tax earnings for higher than usual interest payments
upvoted 0 times
...
Verlene
2 days ago
B) to reflect prevailing credit ratings and market conditions for the issuer
upvoted 0 times
...
Devora
9 days ago
B) to reflect prevailing credit ratings and market conditions for the issuer
upvoted 0 times
...
Gladys
18 days ago
A) to enable investors to establish a tax loss when the bonds are redeemed at maturity
upvoted 0 times
...
Laticia
28 days ago
A) to enable investors to establish a tax loss when the bonds are redeemed at maturity
upvoted 0 times
...
...
Rosendo
1 months ago
D seems like a stretch. I doubt the SEC has a rule specifically about pricing bonds maturing in 2000 and beyond. B is the most logical choice here.
upvoted 0 times
...
Karina
2 months ago
Interesting, I was thinking it might be C, but B makes more sense. The issuer probably wanted to offer a higher yield to attract investors.
upvoted 0 times
Gracia
25 days ago
Yeah, that makes sense. They likely priced the bonds at a premium to attract investors with a higher yield.
upvoted 0 times
...
Ty
1 months ago
I think B is the correct answer. The issuer probably wanted to reflect prevailing market conditions.
upvoted 0 times
...
...
Elizabeth
2 months ago
I believe the issuer priced the bonds at a premium to comply with SEC rules mandating such pricing for debt issues maturing in the year 2000 and thereafter.
upvoted 0 times
...
Alayna
2 months ago
Hmm, I think the answer is B. The bonds are priced at a premium to reflect the issuer's credit ratings and current market conditions.
upvoted 0 times
...
Alease
2 months ago
I agree with Shawnna. It makes sense that the premium pricing would be based on the issuer's creditworthiness and market conditions.
upvoted 0 times
...
Shawnna
2 months ago
I think the bonds were priced at a premium to reflect prevailing credit ratings and market conditions for the issuer.
upvoted 0 times
...

Save Cancel