Consider a Three-Year Coupon Bond That Has a Present Value

question 44

Multiple Choice

Consider a three-year coupon bond that has a present value of $2,000.If the annual rate of discount is 7 percent, and the payment made at the end of each year is $140, the principal amount to be repaid at the end of three years is

• A)$1,860.00.
• B)$2,000.00.
• C)$2,140.00.
• D)$2,156.40.

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Definitions:

Democratic Party

One of the two major contemporary political parties in the United States, traditionally associated with progressive and liberal policies.

Fifteenth Amendment

An amendment to the United States Constitution, ratified in 1870, that prohibits the federal government and each state from denying a citizen the right to vote based on that citizen's "race, color, or previous condition of servitude."

Democratic State Primaries

A process by which the Democratic Party in the United States selects its candidates for various elected positions in government.

Smith V. Allwright

A landmark 1944 US Supreme Court decision that ended the practice of "white primaries" by declaring it unconstitutional, thus allowing African Americans to vote in primary elections.