Could you explain this as if I was 5 years old? Thank you.
"The practice of quoting bond prices net of accrued interest explains why the price of a maturing bond is listed at $1,000 rather than $1,000 plus one coupon payment. A purchaser of an 8% coupon bond one day before the bond’s maturity would receive $1,040 on the following day and so should be willing to pay $1,040. But $40 of that total payment constitutes the accrued interest for the preceding half-year period. The bond price is quoted net of accrued interest and thus appears as $1,000."
