Use the Table for the Question(s)below

question 63

Multiple Choice

Use the table for the question(s) below.
Consider the following zero-coupon yields on default-free securities:
-The price today of a 3-year default-free security with a face value of $1000 and an annual coupon rate of 6% is closest to:

• A)$1000.
• B)$1021.
• C)$1013.
• D)$1005.

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Definitions:

Guarantee

A formal assurance or promise, typically in writing, that certain conditions will be fulfilled, including the quality and durability of a product or service.

Writing

The act or process of composing text or inscriptions.

Statute of Frauds

A law requiring certain types of contracts to be written and signed in order to be legally enforceable.

Charitable Tax Relief

Tax deductions or exemptions granted to donors of charitable contributions, incentivizing the support of non-profit organizations.