Ocean Adventures Issues Bonds Due in 10 Years with a Stated

question 43

Multiple Choice

Ocean Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. Using a financial calculator or Excel, what is the issue price of the bonds?

• A) $537,194.
• B) $464,469.
• C) $538,973.
• D) $500,000.

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Definitions:

Observed Measurement

A quantifiable data point that is directly measured or observed, rather than inferred or estimated.

Stable Over

A term often used in healthcare to indicate that a patient's condition remains unchanged over a period of time.

Justice

Ethical standard of fairness.

Ethical Principle

Fundamental guidelines or rules that are considered to be morally right and acceptable in a profession or society, guiding moral behavior and decision-making.