When the Interest Rate Is 10 Percent, What Is the Price

question 2

Multiple Choice

When the interest rate is 10 percent, what is the price of a bond that matures in one year, has a $300 face value, and has a coupon of $20 per year?

• A)$93.24
• B)$266.11
• C)$272.72
• D)$290.90
• E)$282.64

---

Definitions:

Allocation

The process of assigning resources or goods to various uses or individuals in an economy.

Demand For Product

The desire or need for a product combined with the capacity and willingness to pay for it, which can influence its market price.

Costs Of Production

The aggregate cost of producing a product or delivering a service, encompassing the price of raw materials, workforce, and indirect expenses.

Industry

A group of firms producing similar products or services that serve the same market.