The British Government Has Just Issued a New Consol Bond

question 29

Multiple Choice

The British government has just issued a new consol bond that sells for £1000 and pays interest of 8%.The annual interest payment on this bond must be:

• A)£80.
• B)£8.
• C)£1000.
• D)£12,500.

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Definitions:

Controllable Margin

A financial metric that reflects the amount of profit a business can potentially control or influence directly, typically by managing costs or increasing sales.

Costs

Expenses incurred in the process of producing or acquiring goods and services.

Volume

The quantity or amount of something, often used in context with sales volume or production volume.

Variable Cost

Expenses that change in proportion to the activity of a business, such as costs for raw materials, packaging, or labor directly associated with product manufacturing.