Use the Information for the Question(s)below

question 80

Multiple Choice

Use the information for the question(s) below.
-A firm issues 10-year bonds with a coupon rate of 6.5%, paid semi-annually. The credit spread for this firm's 10-year debt is 0.8%. New 10-year Treasury bonds are being issued at par with a coupon rate of 5%. What should the price of the firm's outstanding 10-year bonds be per $100 of face value?

• A)$98.27
• B)$100.86
• C)$105.26
• D)$97.28

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Definitions:

Intrinsic Motivation

The internal drive to perform a task due to the inherent satisfaction or interest in the task itself, rather than external rewards or pressures.

Sales Employees

Individuals engaged in promoting and selling products or services for a company.

Straight Commission Plan

A compensation plan based on a percentage of sales.

Percentage of Sales

A financial ratio that compares a company's expenses or profits to its total sales, often used to analyze efficiency or profitability.