What Is the Value of a Zero Coupon Bond with a Yield

question 71

Multiple Choice

What is the value of a zero coupon bond with a yield to maturity of 9%,a par value of $1,000,and 10 years to maturity? (Assume semi-annual compounding)

• A) $208.29
• B) $414.64
• C) $422.41
• D) $643.93
• E) $910.00

Understand the effects of different transactions on the accounting equation.

Identify and describe the primary financial statements and their characteristics.

Apply the business entity assumption in various contexts.

Explain the measurement principle and the monetary unit assumption.

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Definitions:

Consumer Protection Agency

A governmental organization designed to protect consumers' rights and ensure fairness in the marketplace.

Maximize Profits

The primary goal of many businesses, which involves increasing the difference between the revenue generated and costs incurred by enhancing efficiency and market share.

Ergonomically Appropriate

Referring to designs or adjustments in the workplace that support the health and well-being of workers, aligning with principles of ergonomics to ensure safety and efficiency.

Corporate Social Action

Activities undertaken by businesses to further social goods beyond the interests of the company and that which is required by law.