A Risk-Free,zero-Coupon Bond with a Face Value of $1,000 Has

question 42

Multiple Choice

A risk-free,zero-coupon bond with a face value of $1,000 has 15 years to maturity.If the YTM is 5.8%,which of the following would be closest to the price this bond will trade at?

• A)$721
• B)$686
• C)$525
• D)$429
• E)$397

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Definitions:

Libido

A term used in psychoanalytic theory to denote the energy of the sexual drive as a component of the life instinct.

Superego

In psychoanalytic theory, the part of the personality that represents internalized ideals and provides standards for judgment (the conscience) and for future aspirations.

Folklorist

A scholar specializing in the study of folklore, including myths, legends, fairy tales, and oral traditions.

Carl Jung

A Swiss psychiatrist and psychoanalyst who founded analytical psychology, emphasizing the importance of the individual psyche and the personal quest for wholeness.