If a $10,000 Face Value Discount Bond Maturing in One

question 77

Multiple Choice

If a $10,000 face value discount bond maturing in one year is selling for $9,000,then its yield to maturity is approximately

• A) 9 percent.
• B) 10 percent.
• C) 11 percent.
• D) 12 percent.

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Definitions:

Price Ceiling

A price ceiling is a government-imposed limit on the price charged for a product or service, intended to prevent prices from rising above a certain level.

Government

The organized body responsible for overseeing the political administration and governance of a state or nation.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a specific price in a given period.

Binding

A situation, typically in the context of contracts or agreements, where parties are legally obligated to adhere to the terms set forth.