A newly issued bond with a face value of $12,000 and no coupon payments is priced at $9,000 . The bond will mature in one year. What is the yield on this bond?
a. 33.3 percent
b. 25 percent
c. $3,000
d. $1,909.09
e. It depends on the interest rate
A
You might also like to view...
An implicit cost is defined as:
A) the opportunity cost of using a resource that is not explicitly paid out by the firm. B) the difference between an input's explicit cost and its actual cost. C) the amount by which economic profit exceeds accounting profit. D) the amount by which the money spent on an input to production exceeds its opportunity cost.
Which of the following does not meet the economic definition of saving?
A. A graduate assistant spends all of his income on tuition B. A student deposits money in her savings account C. A professor spends less than he makes each month D. The president's secretary puts cash under her mattress
When two or more divisions mark up prices in excess of marginal cost:
A. double marginalization occurs. B. second-degree price discrimination occurs. C. two-part pricing occurs. D. None of the answers are correct.
The higher is the current level of saving:
A) the higher is the current level of investment and lower the future level of consumption. B)the lower is the current level of investment and lower the future level of consumption. C) the lower is the current level of investment and higher the future level of consumption. D) the higher is the current level of investment and higher the future level of consumption