Jackson Central Has a 6-Year,8% Annual Coupon Bond with a $1,000

question 61

Multiple Choice

Jackson Central has a 6-year,8% annual coupon bond with a $1,000 par value. Earls Enterprises has a 12-year,8% annual coupon bond with a $1,000 par value. Both bonds currently have a yield to maturity of 6%. Which of the following statements are correct if the market yield increases to 7%?

• A) Both bonds would decrease in value by 4.61%.
• B) The Earls bond will increase in value by $88.25.
• C) The Jackson bond will increase in value by 4.61%.
• D) The Earls bond will decrease in value by 7.56%.
• E) The Earls bond will decrease in value by $50.68.

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Definitions:

Phallic Stage

A stage in Freudian psychosexual development, roughly between the ages of three and six, where the libido centers on the genital area.

Neo-Freudians

Psychologists who were influenced by Sigmund Freud's theories but developed their own distinct psychological theories and ideologies, often emphasizing social and cultural factors over biological bases of personality.

Freud's Theory

A set of psychoanalytic theories developed by Sigmund Freud that emphasize the roles of unconscious motivations, childhood experiences, and sexual and aggressive drives in shaping personality.

Self-actualizers

Individuals who have realized and fulfilled their potential, achieving self-fulfillment and peak experiences as described by Maslow.