The Following Is a List of Prices for Zero Coupon

question 11

Multiple Choice

The following is a list of prices for zero coupon bonds with different maturities and par value of $1,000. $$\begin{array} { | l | l | } \hline \text { Maturity (Years) } & \underline { \text { Price } } \\\hline 1 & \$ 943.40 \\\hline 2 & \$ 881.68 \\\hline 3 & \$ 808.88 \\\hline 4 & \$ 742.09 \\\hline\end{array}$$
-What is,according to the expectations theory,the expected forward rate in the third year?

• A)7.00%
• B)7.33%
• C)9.00%
• D)11.19%
• E)none of the above

---

Definitions:

Error In Billing

Mistakes or inaccuracies in the amount charged on an invoice or billing statement.

Services Rendered

The provision of services to a customer or client, which can be invoiced once the service has been completed.

Subsidiary Ledger

A detailed ledger that contains all the transaction details of a specific account, which rolls up into the general ledger.

Controlling Account

A controlling account is a summary account in the general ledger that consolidates and reflects the total balance of all subsidiary accounts related to it.