Consider the Following Yields to Maturity on Various One-Year, Zero-Coupon

question 17

Multiple Choice

Consider the following yields to maturity on various one-year, zero-coupon securities:

The price (expressed as a percentage of the face value) of a one-year, zero-coupon corporate bond with a AAA rating is closest to ________.

• A) 113.53
• B) 132.45
• C) 75.69
• D) 94.61

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Definitions:

Oliver North

A former United States Marine Corps officer who was involved in the Iran-Contra Affair, a political scandal involving the secret sale of weapons to Iran and the diversion of funds to support Contra rebels in Nicaragua.

Yasir Arafat

A Palestinian political leader and the chairman of the Palestine Liberation Organization (PLO) from 1969 until his death in 2004, who played a central role in the Palestinian liberation movement.

Palestine Liberation Organization

A political and militant organization founded in 1964, claiming to represent the world's Palestinian people in their struggle for an independent state.

Terrorism

The use of violence and intimidation, especially against civilians, in the pursuit of political aims.