Use the Information for the Question(s)below

question 84

Multiple Choice

Use the information for the question(s) below.
Luther Industries needs to raise $25 million to fund a new office complex.The company plans on issuing ten-year bonds with a face value of $1000 and a coupon rate of 7.0% (annual payments) .The following table summarizes the YTM for similar ten-year corporate bonds of various credit ratings:

-Assuming that Luther's bonds receive a AAA rating,the number of bonds that Luther must issue to raise the needed $25 million is closest to:

• A)24,655
• B)25,000
• C)24,477
• D)26,681
• E)25,114

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Definitions:

Superstructure

In Marxist theory, the cultural, ideological, and institutional structures built upon the economic base (infrastructure) of a society.

Capitalist Accumulation

The process by which capitalists generate wealth and expand their capital through reinvestment of profits.

Exchange Value

The worth of a good or service determined by the amount of other goods or services for which it can be traded or sold.

Workers' Labor

Refers to the physical or mental effort exerted by employees or workers in the production of goods or provision of services.