A. paid interest
B. unpaid interest
C. zero interest
D. accrued interest
✅ The correct answer is option D.
Coupon payment accrued between last payment and settlement date is classified as accrued interest. An accrual bond is a bond that does not pay periodic interest payments.
Coupon payment accrued between last payment and settlement date is classified as accrued interest. An accrual bond is a bond that does not pay periodic interest payments.