A Semiannual Coupon Bond Has a 5% Coupon Rate, a $1,000

question 5

Multiple Choice

A semiannual coupon bond has a 5% coupon rate, a $1,000 face value, a current value of $1,020, and 3 years until the first call date. What is the call price if the yield to call is 5.5%?

• A)$1,000
• B)$1,020
• C)$1,040
• D)$1,060
• E)$1,080

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Definitions:

Mere Exposure Effect

The phenomenon that the more individuals encounter someone or something, the more probable it is that they will start liking the person or thing even if they do not realize they have seen it before.

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A profoundly intense and overwhelming emotion characterized by strong desire, deep connection, and affection towards someone.

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