The amount the owner expects to receive when the bond matures is known as:

Question

Options

• AMaturity value
• BRipe value
• CPar value
• DDeveloped value

• A
  5% (3)
• B
  8% (5)
• C
  84% (52)
• D
  3% (2)

Explanation

Par value (C) is the face value of a bond - the fixed amount printed on the bond certificate that the issuer promises to repay to the bondholder at maturity. This is the standard financial term used in bond contracts, investment accounts, and accounting records.

Why the distractors are wrong:

• A (Maturity value) is a plausible-sounding term but is not the standard term for this concept; it can also refer to the total value including accumulated interest in other contexts, making it imprecise.
• B (Ripe value) is not a real financial term - it's a trap designed to exploit the word association with "maturity" (as in ripening).
• D (Developed value) is also fabricated and has no meaning in finance.

Memory tip: Think of "par" as in "par for the course" in golf - it's the standard, baseline amount. A bond issued "at par" means you pay exactly its face value, and you receive exactly that face value back when it matures. If you ever see "par value," "face value," or "nominal value" on an exam, they all refer to the same thing.

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