If a bond is selling at par value, the market return on similar bonds must be:

A) higher than the coupon rate.
B) equal to the coupon rate.
C) below the coupon rate.
D) None of the above

Par Value

A nominal value assigned to a security or stock as stated in the corporate charter, which bears no relation to market value.

Market Return

The total return on an investment, including dividends and capital gains, as measured over a specified period in the overall market.

Coupon Rate

The annual interest rate paid by a bond, expressed as a percentage of the bond's face value.