A Corporate Bond Is Quoted at a Current Price of 102.767

question 63

Multiple Choice

A corporate bond is quoted at a current price of 102.767. What is the market price of a bond with a $1,000 face value?

• A) $1,000.28
• B) $1,002.77
• C) $1,027.67
• D) $1,102.77
• E) $1,276.70

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Definitions:

Compounded Monthly

A method where interest is calculated monthly and added to the principal sum, resulting in interest on interest.

Periodic Interest Rate

The interest rate charged or paid over a specific period of time, often expressed as a percentage.

Payment Interval

The scheduled period between payments made by a borrower or payer to a lender or payee.

Compounded Quarterly

A financial calculation where interest is added to the principal four times a year, resulting in an increased amount on which subsequent interest calculations are based.