Use the Following Information to Answer the Question(s)below

question 25

Multiple Choice

Use the following information to answer the question(s) below.
-The price today of a two-year default-free security with a face value of $1000 and an annual coupon rate of 5% is closest to:

• A)$1002.78.
• B)$1003.31.
• C)$1028.50.
• D)$1028.61.

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Definitions:

Paraphrasing

The act of rewording or rephrasing text or speech to clarify its meaning or to present it in a different manner, while retaining the original message.

Secondary Source

Information that has been interpreted, analyzed, or summarized from primary sources, often used in research.

Direct Quote

A verbatim excerpt from a text or speech used to support or illustrate a point.

Causation

The relationship between cause and effect, where one event is understood to be the direct result of another.