Which of the Following Amounts Is Closest to the Value

question 51

Multiple Choice

Which of the following amounts is closest to the value of a bond that pays $55 semiannually and has an effective semiannual interest rate of 5%? The face value is $1,000 and the bond matures in 3 years. There are exactly six months before the first interest payment.

• A) $888
• B) $1,000
• C) $1,014
• D) $1,025
• E) $1,055

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Definitions:

Sherman Act

A foundational United States antitrust law aimed at maintaining fair competition in the marketplace by prohibiting monopolies, cartels, and anticompetitive practices.

Unreasonable Restraint

Restrictions or practices that excessively limit trade or competition beyond what is considered fair or legal.

Affects Commerce

Refers to any activity, action, or situation that has a direct or indirect impact on commercial transactions, trade, or economic activities across state or national borders.

Clayton Act

A U.S. antitrust law, enacted in 1914, aimed at preventing monopolies and promoting competition.