The British Government Has a Consol Bond Outstanding That Pays

question 68

Multiple Choice

The British government has a consol bond outstanding that pays ₤100 in interest each year.Assuming that the current interest rate in Great Britain is 5% and that you will receive your first interest payment one year from now,then the value of the consol bond is closest to:

• A)₤1000.
• B)₤1100.
• C)₤2100.
• D)₤2000.