A Zero Coupon Bond with a Face Value of $1,000

question 17

Multiple Choice

A zero coupon bond with a face value of $1,000 is issued with an initial price of $463.34. The bond matures in 25 years. What is the implicit interest,in dollars,for the first year of the bond's life?

• A) $9.08
• B) $12.56
• C) $14.48
• D) $21.47
• E) $31.25

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Definitions:

Pillsbury Bake-Off

A cooking contest, initiated in 1949, where contestants from across the United States compete by preparing original recipes with predefined products from the Pillsbury Company.

Product Usage

Product usage concerns how consumers interact with and utilize a product, including frequency, purpose, and manner of use.

Contest

A competition where individuals or groups compete for a prize or recognition.

Doritos

a brand of flavored tortilla chips produced by Frito-Lay, a division of PepsiCo.