What Is the Value of a 10 Percent Semi-Annual Coupon

question 18

Multiple Choice

What is the value of a 10 percent semi-annual coupon bond with a par value of $1,000 that matures in 5 years and has a required rate of return of 9 percent?

• A) $1,021.95
• B) $1,038.90
• C) $1,039.56
• D) $1,064.18
• E) $1,078.23

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Definitions:

Utility

Utility is an economic concept referring to the satisfaction or benefit a consumer receives from consuming a good or service.

Organizational Buyers

Businesses or entities that purchase goods and services for their own use, for production, or for resale to others.

Raw Materials

The basic substances or components that are processed or refined to create finished goods or products.

Manufacturers

Companies or entities that make goods through a process involving raw materials, components, or assemblies, usually on a large scale.