QUESTION4 A $40,000 collateral bond has a coupon rate of 7% per year payable quarterly. The bond matures 30 years from now. At a market interest rate of 7% per year compounded semiannually, the amount and frequency of the bond interest payments is: a. $350 per year b. $350 per quarter C. $700 per year d. $700 per quarter
QUESTION4 A $40,000 collateral bond has a coupon rate of 7% per year payable quarterly. The bond matures 30 years from now. At a market interest rate of 7% per year compounded semiannually, the amount and frequency of the bond interest payments is: a. $350 per year b. $350 per quarter C. $700 per year d. $700 per quarter
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:QUESTION 4
A $40,000 collateral bond has a coupon rate of 7% per year payable quarterly. The bond matures 30 years from
now. At a market interest rate of 7% per year compounded semiannually, the amount and frequency of the
bond interest payments is:
a. $350 per year
b. $350 per quarter
c. $700 per year
d. $700 per quarter
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