Mars Corp Issued Ten-Year Bonds with a Maturity Value of

question 38

Multiple Choice

Mars Corp. issued ten-year bonds with a maturity value of $ 400,000. If the bonds were issued at a premium, this indicates that

• A) the market rate was higher than the stated rate.
• B) the stated rate was higher than the market rate.
• C) the market and stated rates were the same.
• D) no relationship exists between the two rates.

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Definitions:

Deregulating

The process of reducing or eliminating government regulations on industries to foster a more efficient and competitive business environment.

Electricity

A form of energy resulting from the existence of charged particles, used as a power source.

Natural Gas

A fossil fuel used as a source of energy for heating, cooking, and electricity generation, consisting mainly of methane.

Profit Maximizes

A strategy or approach focused on increasing the difference between total revenue and total cost to the highest possible level.