A Corporate Bond Makes Payments of $9

question 114

Multiple Choice

A corporate bond makes payments of $9.67 every month for ten years with a final payment of $2009.67.Which of the following best describes this bond?

• A)a 10-year bond with a face value of $2000 and a coupon rate of 4.8% with monthly payments
• B)a 10-year bond with a face value of $2000 and a coupon rate of 5.8% with monthly payments
• C)a 10-year bond with a face value of $2009.67 and a coupon rate of 4.8% with monthly payments
• D)a 10-year bond with a face value of $2009.67 and a coupon rate of 5.8% with monthly payments
• E)a 10-year bond with a face value of $2009.67 and a coupon rate of 6.8% with monthly payments

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Definitions:

Machine-Hours

A measure of the amount of time machines are used in the production process, often related to the allocation of manufacturing overhead.

Direct Labor-Hours

The total hours of labor directly involved in the production of goods or services, used as a basis for assigning labor costs to products.

Forming

A manufacturing process that involves shaping and combining materials to create a product.

Customizing

The process of modifying products or services to meet specific customer needs or preferences.