McCurdy Co

question 1

Multiple Choice

McCurdy Co.'s Class Q bonds have a 12-year maturity, $1,000 par value, and a 5.75% coupon paid semiannually (2.875% each 6 months) , and those bonds sell at their par value.McCurdy's Class P bonds have the same risk, maturity, and par value, but the P bonds pay a 5.75% annual coupon.Neither bond is callable.At what price should the annual payment bond sell?

• A) $943.98
• B) $968.18
• C) $993.01
• D) $1,017.83
• E) $1,043.28

---

Definitions:

Death Penalty

A legal sentence to death as punishment for a crime, also known as capital punishment.

Probation

When a convicted defendant is released from confinement but is still under court supervision for a period of time.

Sentence

The punishment, or penalty, ordered by the court to be inflicted on a person convicted of a crime.

Probable Cause

A reasonable basis for believing that a crime has been or is being committed, justifying a search or arrest by law enforcement.