How Much Should You Be Prepared to Pay for a 10-Year

question 52

Multiple Choice

How much should you be prepared to pay for a 10-year bond with a 6 percent coupon, semi-annual payments, and a semi-annually compounded yield of 7.5 percent?

• A)$895.78
• B)$897.04
• C)$938.40
• D)$1,312.66 Using the BAII Plus calculator:

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Definitions:

Internal Control

Procedures and practices implemented by a company to safeguard its assets, ensure accurate financial reports, and ensure compliance with laws and regulations.

Cash Disbursements

The outflow of cash for expenses, investments, and other payments during a given period.

Internal Control

Processes designed to provide reasonable assurance regarding the achievement of various objectives such as the effectiveness and efficiency of operations.

Documentation Procedures

The processes and methods for systematically recording and organizing documents and records pertinent to business operations.