Jia Hua Enterprises Wants to Issue Sixty 20-Year, $1,000 Par

question 180

Multiple Choice

Jia Hua Enterprises wants to issue sixty 20-year, $1,000 par value, zero-coupon bonds. If each bond is priced to yield 7 percent, how much will Jia Hua receive (ignoring issuance costs) when the bonds are first sold?

• A) $11,212
• B) $12,393
• C) $15,505
• D) $18,880
• E) $20,000

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Definitions:

Diathesis-Stress Model

A psychological theory that explains behavior as both a result of genetic and biological predispositions and life stressors.

Dynamically and Reciprocally Interacting

A process or situation where factors or entities influence each other in complex and interrelated ways over time.

Regression

A return to earlier stages of development or behavior in response to stress or trauma.

Freud

Sigmund Freud, an Austrian neurologist, pioneered psychoanalysis, which is a therapeutic approach for addressing mental disorders through conversations between a psychoanalyst and their patient.