Q1. [2]
What does maturity of a 'Bond' refer to ?
Previously asked in CBSE board exam
2025 92 Q12
Generated by claude-sonnet-4-6 · 2026-06-15 07:07 · grounding rag
Model Answer
Maturity of a bond refers to the date on which the bond's life ends and the issuer repays the principal (face value) amount to the bondholder. It is the predetermined date when the loan agreement between the issuer and the investor expires and the final payment is made.
Explanation
- Examiners expect two key points: (1) it is a specific date/period and (2) the principal is repaid on that date.
- Avoid confusing maturity with interest payment (coupon) — maturity is specifically about repayment of the original borrowed amount.
- Keep the answer factual and direct; no examples are needed for 2 marks.
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