Dave Harris Has Just Purchased a Bond with a Face

question 53

Multiple Choice

Dave Harris has just purchased a bond with a face value of $1,000 that pays 6 percent.The purchase price of the bond was $900,and the bond will mature in 5 years.What is the yield to maturity for this bond?

• A)5.5 percent
• B)6.0 percent
• C)8.4 percent
• D)9.0 percent
• E)6.7 percent

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Definitions:

Private Property

Ownership of assets (land, buildings, goods) by individuals or corporations, legally protected by the government.

Karl Marx

A 19th-century philosopher, economist, and social scientist best known for his theories about capitalism and communism.

Capitalist

An economic system in which private individuals rather than the state own and control property and businesses, operating for a profit.

Worker

An individual who performs tasks or labors for payment, contributing their skills and efforts to an organization or economy.