A 25-Year, $10,000 Strip Bond Was First Issued at 6

question 128

Multiple Choice

A 25-year, $10,000 strip bond was first issued at 6% compounded semi-annually. Nine years before maturity it was sold on the bond market at a price that would provide the purchaser with a yield rate of 6.8% compounded semi-annually. What was the selling price at that time?

• A) $3,430
• B) $3,883
• C) $5,478
• D) $5,874
• E) $6,246

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Goal Challenge

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