A $1,000 Par Value Bond Pays Interest of $35 Each

question 109

Multiple Choice

A $1,000 par value bond pays interest of $35 each quarter and will mature in 10 years.If your simple annual required rate of return is 12 percent with quarterly compounding,how much should you be willing to pay for this bond?

• A) $941.36
• B) $1,051.25
• C) $1,115.57
• D) $1,391.00
• E) $825.49

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