Last Year,BT Motors Issued 10-Year Bonds with a 9 Percent

question 10

Multiple Choice

Last year,BT Motors issued 10-year bonds with a 9 percent coupon and semi-annual interest payments.What is the market price of a $1,000 bond if the yield to maturity is 8.9 percent?

• A) $1,003.97
• B) $1,006.53
• C) $1,042.89
• D) $1,414.14
• E) $1,585.36

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Definitions:

Estimated Product

A provisional evaluation or calculation of a product's potential production costs, sales value, or impact on the market.

Warranty Expense

Costs associated with the commitment to repair or replace a product if it fails within a specified period.

Warranty Repairs

Services offered to repair or replace products free of charge that have been sold with a guarantee promising repair if necessary within a certain period.

Income Statement

A financial document summarizing a company's revenues, expenses, and profits over a specific period, typically a quarter or year.