Exhibit 18.3 Use the Information Below for the Following Problem(S)

question 79

Multiple Choice

Exhibit 18.3
Use the Information Below for the Following Problem(S)
A $1000 par value bond with 4 years to maturity and a 5% coupon has a yield to maturity of 6%. Interest is paid annually.
-Refer to Exhibit 18.3.Calculate the current price of the bond.

• A) $964.90
• B) $965.35
• C) $981.41
• D) $1035.45
• E) $1035.85

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Definitions:

Profit Maximisation

An objective of management to achieve the highest possible profit from operations, usually by increasing revenue and/or reducing costs.

Employee Morale

The overall outlook, attitude, satisfaction, and confidence that employees feel at work, which can significantly impact productivity and retention.

Constraints

Limitations or restrictions that affect the planning, process, or outcome of an activity or system.

Opportunity Costs

The cost of forgoing the next best alternative when making a decision or choosing between options.