Certainly! Let's break down the question to arrive at a detailed solution.
### Key Concepts:
1. Bond: A bond is a fixed income instrument that represents a loan made by an investor to a borrower (typically corporate or governmental). A bond has an end date at which the principal of the loan is due to be paid back along with periodic interest payments.
2. Face Value (or Par Value): This is the amount paid back to the bondholder at maturity. It's also the basis for calculating interest payments.
3. Interest: Interest is the payment from a borrower to a lender of an amount above the repayment of the principal sum (face value) received by the lender.
### Understanding the Statement:
The question states: "On the date the bond term matures, the face value of the bond plus Interest is paid back to you."
This means that on the maturity date of the bond, as a bondholder, you will receive:
1. The face value of the bond.
2. Any accumulated interest.
To determine if the statement is True or False, we need to verify if the bondholder does indeed receive both the face value and the interest at maturity.
### Detailed Reasoning:
- Face Value Repayment: When a bond matures, the issuer is obligated to pay back the face value of the bond to the holder.
- Interest Payments: Typically, interest is paid periodically (semi-annually, annually, etc.) over the life of the bond. However, the final interest payment is made at maturity along with the repayment of the face value.
Given this understanding, the statement is correct because, at maturity, the bondholder receives the face value plus any final interest payment due.
### Conclusion:
Therefore, the statement "On the date the bond term matures, the face value of the bond plus Interest is paid back to you" is True.
