A Treasury Security That Matures in One Year Has a Face

question 50

Multiple Choice

A Treasury security that matures in one year has a face value of $10,000 and sells for $9,300. What is its yield-to-maturity, to the nearest tenth of a percent?

• A)9.3%
• B)7.5%
• C)5.5%
• D)7.0%

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Definitions:

Identical Costs

Costs that are the same in amount or value, often referring to uniform expenses across different units or operations.

Average Total Cost

The total cost of production divided by the quantity produced, representing the average cost of producing each unit of output.

Competitive Market

A market structure characterized by a large number of sellers and buyers, where no single entity can significantly influence prices, leading to optimal product pricing and variety.

Economic Profit

The difference between the total revenue earned by a business and the total opportunity costs of all resources used in the production.