Exhibit 18.3 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 34

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. Estimate the percentage price change for this 4-year $1,000 par value bond, with annual 5% coupon, if the yield falls from 6% to 5.5%.

• A)-3.50%
• B)-1.75%
• C)1.75%
• D)3.50%
• E)None of the above

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Definitions:

Salty Tastes

Pertains to one of the basic tastes, recognized by the presence of sodium ions, typically experienced from eating foods with salt.

Sweet Tastes

One of the basic tastes, perceived by the taste buds on the tongue, often associated with foods rich in sugars.

Genetic Makeup

The unique set of genes and alleles present in an organism, determining its hereditary characteristics.

Psychological

Psychological pertains to the mind or mental processes and how they influence behavior, emotions, and attitudes.