If a Bond Offers $1,000 in Interest Payments at the End

question 90

Multiple Choice

If a bond offers $1,000 in interest payments at the end of each of next 5 years and a repayment of $10,000 also at the end of the 5 years and the current discount rate is 3 percent, what is the present value of the bond?

• A)$13,205
• B)$10,857
• C)$12,569
• D)$4,580

Understand the concept of synaptic plasticity and its implications for learning and memory.

Differentiate between excitatory and inhibitory neurotransmitters and their effects on neuron polarization.

Comprehend the mechanisms behind psychoactive drugs and their effects on neurotransmission.

Understand the physical changes in the brain's structure and neurotransmitter systems with aging and diseases.

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Definitions:

Reinvested

Refers to plowing back earnings or investment returns into purchasing more securities or assets to compound growth.

Initial Investment

The sum of funds allocated for initiating a project, acquiring an asset, or investing in a financial product.

Future Value

The estimated value of an investment at a specified future date, considering factors like interest rates and compounding.

Present Value

The present-day valuation of money or cash flows expected in the future, calculated with a designated rate of return.