Assume a Two-Year Maturity Bond with a Face Value of $1,000

question 3

Multiple Choice

Assume a two-year maturity bond with a face value of $1,000 and a coupon rate of 10%.If the current market interest rate is i = 8%, we know that the price of this bond will be

• A)$1,210
• B)$1,124
• C)$1,036
• D)$984
• E)$920

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