You Are Considering Investing in a Zero-Coupon Bond That Will

question 82

Multiple Choice

You are considering investing in a zero-coupon bond that will pay you its face value of $1000 in twelve years. If the bond is currently selling for $496.97, then the internal rate of return (IRR) for investing in this bond is closest to ________.

• A) 5.0%
• B) 7.1%
• C) 6.0%
• D) 8.2%

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Definitions:

Synergistic Relationship

A cooperative interaction between two or more entities that results in a combined effect greater than the sum of their separate effects.

Stakeholders

Individuals or groups that have an interest in or are affected by the operations and decisions of a business or organization.

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A demographic cohort following the baby boomers and preceding the millennials, typically born between the early 1960s and late 1970s.

Sustainability-Conscious

Being aware of and making choices that are beneficial to sustaining environmental, economic, and social well-being for the future.