A Ten-Year,zero-Coupon Bond with a Yield to Maturity of 6

question 116

Multiple Choice

A ten-year,zero-coupon bond with a yield to maturity of 6% has a face value of $1000.An investor purchases the bond when it is initially traded,and then sells it four years later.What is the internal rate of return (IRR) of this investment,assuming the yield to maturity does not change?

• A) 0.26%
• B) 3.07%
• C) 6.00%
• D) 7.65%
• E) 8.14%

---

Definitions:

Contradiction

A situation or statement in which two or more opposing things are true or valid at the same time, highlighting a discrepancy or conflict.

Vaillant Study

A research project that tracked the physical and emotional health of a group of men over several decades, aiming to identify predictors of healthy aging.

Psychosocial Adjustment

The process of adapting to and coping with interpersonal and societal expectations and pressures.

Altruism

Behavior intended to help others out of inner concern and without expectation of external reward; may involve self-denial or self-sacrifice.