$\begin{array}{cc}\text { Year } & \text { 1-Year Forward Rate } \\1 & 4.6\% \\2 &4.9\% \\3 & 5.2\% \\4 & 5.5\% \\5 &6.8\%\end{array}$

question 28

Multiple Choice

$\begin{array}{cc}\text { Year } & \text { 1-Year Forward Rate } \\1 & 4.6\% \\2 &4.9\% \\3 & 5.2\% \\4 & 5.5\% \\5 &6.8\%\end{array}$
What should the purchase price of a 3-year zero-coupon bond be if it is purchased today and has face value of $1,000?

• A) $887.42
• B) $871.12
• C) $879.54
• D) $856.02
• E) $866.32

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Definitions:

Physical Resources

Physical resources refer to tangible assets and materials used in the production of goods and services, such as machinery, buildings, and raw materials.

Human Resources

The department within an organization that deals with the recruitment, management, and guidance of its employees.

Long Run

A period in economics where all factors of production and costs are variable, allowing for all inputs to be adjusted.

Computer Technology

The study and use of computers, software, and systems for processing, storing, and sending information.