n NISM Certifications
X NISM Series X
Medium

How is the coupon rate in a public debenture issue determined?

Practice question from NISM Series XA- Investment Adviser (Level 1) Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Fixed by SEBI

  2. B

    Through RBI auction

  3. Via book building process

    Correct answer

  4. D

    Fixed by the stock exchange

Why this is the answer

The coupon rate is typically determined through a book-building process where investors bid for the rate they are willing to accept.

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