A $1 000 000, 9% Bond with Interest Payable Annually

question 78

Essay

A $1 000 000, 9% bond with interest payable annually is redeemable at 104 in 5 years. What is the purchase price to yield 8% compounded quarterly?

---

Definitions:

Neurotransmitter Dopamine

A chemical messenger in the brain that plays roles in movement, motivation, and the pleasure-reward system.

Conditioned Fear Response

A learned fear reaction to a previously neutral stimulus that has been repeatedly presented along with an aversive stimulus.

Id

In psychoanalytic theory, the part of the mind that is the source of instinctive impulses that demand satisfaction.

Pleasure Principle

The driving force of the id that seeks immediate gratification of all desires, wants, and needs.