At the Beginning of the Year,you Purchased a 5-Year Zero

question 14

Multiple Choice

At the beginning of the year,you purchased a 5-year zero coupon bond with a yield to maturity of 5.00% and a face value of $1,000.Your tax rate is 30.00%.What is the total tax that you will have to pay on the bond during the first year? Do not round your intermediate calculations.

• A) $14.34
• B) $11.87
• C) $11.75
• D) $10.23
• E) $10.70

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Definitions:

Values

Fundamental beliefs or standards that guide behaviors and decisions in a society or individual.

Ideals

Principles or values that one actively pursues as goals or standards of perfection.

Assumptions

Beliefs or ideas taken for granted without proof in research or argumentation.

Authority-Oriented

Characterized by a focus on following orders, respecting hierarchy, and valuing leadership and structure in decision-making contexts.