On January 1, a Company Issues 8%, 5-Year, $300,000 Bonds $3 \%$

question 51

Multiple Choice

On January 1, a company issues 8%, 5-year, $300,000 bonds that pay interest semiannually. On the issue date, the annual market rate of interest is 6%. The following information is taken from present value tables: Present value of an annuity for 10 periods at $3 \%$$\quad$$\quad$ 8.5302
Present value of an annuity for 10 periods at $4 \%$
Present value of 1 due in 10 periods at $3 \%$$\quad$$\quad$$\quad$$\quad$ 0.7441
Present value of 1 due in 10 periods at $4 \%$$\quad$$\quad$$\quad$$\quad$ 0.6756 What is the issue (selling) price of the bond?

• A)$402,362
• B)$300,010
• C)$420,000
• D)$308,107
• E)$325,592

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Definitions:

Effective Encoding

The process of converting information into a form that allows it to be stored in our memory.

Amygdala

A key structure within the brain associated with processing emotions, including fear and pleasure.

Emotional Events

Incidents or situations that elicit strong emotional responses, such as joy, anger, fear, or sadness.

Long-Term Potentiation

A long-lasting increase in signal transmission between two neurons that results from stimulating them synchronously.