'That was embarrassing!' Jennifer Lawrence trips and falls as she climbs the steps to accept her Best Actress Oscar. Winning an Oscar for Best Actress is beyond doubt the biggest moment of any star's career. But Jennifer Lawrence distracted somewhat from the honour by tripping up the stairs as she headed onto the stage to accept her Academy Award.
A bond is issued with a stated value, known as the par, or face, value. This is the value at which the bond will be bought back by the issuer upon its maturity. Though there are exceptions to the rule, most bonds are issued with a $1,000 par value.
Given the previous discount function, such a bond has a present value of $97.84. Based on its initial par value of $100, the yield is 6% per year. However, given the fact that it is selling for $97.84, the effective yield is greater. To reflect this, analysts often use a derived figure, the yield-to-maturity.