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If You Own a $1,000 Face Value Bond with One

question 62

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If you own a $1,000 face value bond with one year remaining to maturity and a 3 percent coupon rate and new bonds are paying 14 percent, what is the most you can get for your old bond?


Definitions:

Sundry Account

An account used to record minor or infrequent transactions not fitting into other specific account categories.

Tickler File

An organizational system used to remind a person of tasks that need to be done at specific future dates.

Unpaid Vouchers

Refers to vouchers, which represent obligations or promises to pay, that have not yet been settled or paid.

Gross Method

An accounting method for recording purchases of inventory at their full invoice prices without deducting any cash discounts offered.

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