A $5,000 Face Value Municipal Bond Matures in 12 Years

question 96

Multiple Choice

A $5,000 face value municipal bond matures in 12 years and is priced at $4,850. The coupon rate is 5.5% with interest paid semiannually. What is the yield to maturity on the bond?

• A)4.77%
• B)5.14%
• C)5.40%
• D)5.61%
• E)5.85%

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Definitions:

Greater Power

Refers to the superior ability or authority of an individual or group to influence or control outcomes in their favor.

Controlled Processing System

A cognitive system involving conscious, deliberate thought and attention for complex tasks or decisions.

Rigid

Describes something or someone that is inflexible, strict, or unable to change.

Objective Power

The ability to influence others or affect outcomes based on one's position or resources, independently of personal characteristics.