Assume That You Are Considering the Purchase of a 15-Year

question 77

Multiple Choice

Assume that you are considering the purchase of a 15-year bond with an annual coupon rate of 9.5%. The bond has face value of $1,000 and makes semiannual interest payments. If you require an 11.0% nominal yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?

• A) $891.00
• B) $913.27
• C) $936.10
• D) $959.51
• E) $983.49

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Definitions:

Negative Control

A genetic control system in which a regulatory protein binds to DNA, turning off transcription of a gene. Compare with positive control.

Operon

In prokaryotes, a group of structural genes that are coordinately controlled and transcribed as a single message, plus their adjacent regulatory elements.

Protein Binding

The interaction between a protein and another molecule, which could be another protein, a small molecule, or DNA, critical for many biological processes.

cAMP Levels

Concentrations of cyclic adenosine monophosphate, a secondary messenger important in many biological processes including signal transduction and intracellular communication.