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Suppose You Purchase a Bond with a 5 Percent Risk-Free

Question 47

Multiple Choice

Suppose you purchase a bond with a 5 percent risk-free rate that matures in three years.The bond pays $250 at the end of each year and a principal amount of $2,000 on maturity.The present value of the bond is ?


A) $3,000.
B) $2,408.51.
C) $2,123.
D) $3,433.62.

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