If You Own a $1,000 Face Value Bond with One

question 222

Multiple Choice

If you own a $1,000 face value bond with one year remaining to maturity and a 3 percent coupon rate and new bonds are paying 9 percent,what is the most you can get for your old bond today?

• A)$917.43
• B)$944.95
• C)$970.87
• D)$1,000

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Definitions:

Invested

Assets or capital put into an endeavor or investment with the expectation of generating a profit.

Days

Units of time measuring 24 hours, constituting the most basic building block of calendars.

Missing Value

Data that is absent from a dataset, which can occur for various reasons and potentially impact analyses.

Calculate

To ascertain by computation; determine by mathematical means.