Zeta Corporation Has Issued a $1,000 Face Value Zero-Coupon Bond

question 9

Multiple Choice

Zeta Corporation has issued a $1,000 face value zero-coupon bond. Which of the following values is closest to the correct price for the bond if the appropriate discount rate is 4% and the bond matures in 8 years?

• A) $968.
• B) $731.
• C) $1,000.
• D) $1,125.

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Definitions:

Influenced

Refers to being affected or altered by an external factor or variable.

Sample Regression Line

This is the line obtained from the regression analysis of sample data, used to predict the dependent variable values from the independent variable.

Dependent Variable

A variable in an experiment or model that is expected to change in response to changes in the independent variable.

Independent Variables

Variables in an experiment or model that are manipulated or varied by the researcher to determine their effect on the dependent variable.