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A company has issued a bond having face value of ₹ 70,000, carrying an annual dividend rate of 8% and maturing in 15 years. If the bond is redeemed at par, then which of the following statements are true?

A. The annual dividend is ₹ 5,600.

B. The annual dividend is ₹ 6,300.

C. Redemption price is ₹ 73,000.

D. Redemption price is ₹ 70,000.

Choose the correct answer from the options given below:

Solution

✅ Correct Option: 3

Annual dividend =8%= 8\% of Rs. 70,000 == Rs. 5,600, so A is true and B is false.

Redemption at par means the bond is redeemed at its face value, that is Rs. 70,000, so D is true and C is false.

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