Bateman Enterprises Invested in the Bonds of Greater Gloucester on January

question 165

Multiple Choice

Bateman Enterprises invested in the bonds of Greater Gloucester on January 1, 2018. These 10-year, $300,000 bonds pay interest of 3% with semiannual payments every June 30 and December 31. The effective rate of interest for similar bonds on January 1 was 4%. What is the semi-annual interest payment received by Bateman for these bonds?

• A) $4,500
• B) $9,000
• C) $3,750
• D) $5,250

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Definitions:

Confirmation Bias

The tendency to search for, interpret, favor, and recall information that confirms one’s preexisting beliefs or hypotheses.

Emotional Valence

Emotional valence refers to the intrinsic attractiveness(positive) or averseness(negative) of an event, object, or situation.

Bounded Rationality

Bounded Rationality is a concept suggesting that the cognitive limitations of the mind and the finite amount of time available to make decisions affect the rationality of individuals.

Limited Information

The condition of having incomplete data or knowledge concerning a particular topic or situation.