What Is the Value of a 25-Year Bond with a $1,000

question 47

Multiple Choice

What is the value of a 25-year bond with a $1,000 face value and an 8% coupon rate that yields 4%?

• A) $ 716.84
• B) $1,124.67
• C) $1,624.88
• D) $ 996.53
• E) $1,087.22

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Definitions:

Lower of Cost or Market

Accounting principle where inventory is stated at the lower value between its original cost and current market price.

Inventory Item

A specific product or material that a company holds in stock with the intent to sell or use in the production process.

Inventory Value

The total cost or market value of all items held in stock by a business, including raw materials, work-in-progress, and finished goods.

Perpetual FIFO Method

is an inventory valuation technique assuming that the first items purchased (First In) are the first ones sold (First Out), continuously updated for each transaction.