A Firm Issues $500 Million in Twenty-Year Bonds with an Annual

question 99

Multiple Choice

A firm issues $500 million in twenty-year bonds with an annual coupon rate of 5%.The firm uses a sinking fund to repurchase 4% of the bond issue on each coupon payment date.What payment must they make on the twentieth and final coupon payment date?

• A)$25 million
• B)$120 million
• C)$145 million
• D)$160 million
• E)$200 million

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Definitions:

Intentionally

The action of doing something deliberately or with specific purpose, often used in legal contexts to determine the level of culpability or responsibility.

Descriptive Term

A word or phrase that describes the characteristics, qualities, or functions of a product, service, or concept.

Secondary Meaning

A legal concept indicating that a descriptive or generic term has become distinctively associated with a particular product or service over time.

Trademark Law

Legislation that protects the exclusive rights to use a specific mark to identify goods or services, preventing others from using a similar mark.