PART 1: Why Corporate Bonds are carrying \"exchange prices\" fluctuating everyda

Question

PART 1:
Why Corporate Bonds are carrying "exchange prices" fluctuating everyday and different from it's original "Issued Prices" by corporations?

PART 2:
Describe how the market interest rate, relative to the contractual interest rate, affects the selling price of bonds. Also explain the rationale for requiring an investor to pay accrued interest when a bond is purchased between interest payment dates.

PART 1:
Why Corporate Bonds are carrying "exchange prices" fluctuating everyday and different from it's original "Issued Prices" by corporations?

PART 2:
Describe how the market interest rate, relative to the contractual interest rate, affects the selling price of bonds. Also explain the rationale for requiring an investor to pay accrued interest when a bond is purchased between interest payment dates.

Explanation / Answer

Part 1:
Because prices vary according to the demand of bonds and on the extent on which they are sold in market so they are varied, if demand increases bond price increases and if they are beung sold ao a higher price, price of bond decreases.
It varies with the change in Market interest rate.

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