Reduce the Fraction 125/8 into a Mixed Number and Simplify

question 18

Multiple Choice

Reduce the fraction 125/8 into a mixed number and simplify to the lowest terms.

• A)15 5/8
• B)15 3/16
• C)16 4/17
• D)18 6/23

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Definitions:

Coupon Interest Rate

The annual interest rate paid by a bond expressed as a percentage of its face value.

Present Value Factor

A factor used to calculate the present value of a sum to be received in the future, considering a specific interest rate over a certain period.

Premium Amortization

The gradual reduction of the premium paid above the face value of a bond, allocated over the bond's life until maturity.

Effective Interest Method

An accounting practice for amortizing the discount or premium on bonds payable or receivable, which reflects the actual interest rate the bond earns.