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Suppose You Purchase a Zero-Coupon Bond with Face Value $1,000

Question 300

Multiple Choice

Suppose you purchase a zero-coupon bond with face value $1,000, maturing in 20 years, for $214.51. What is the implicit interest, in dollars, in the first year of the bond's life?


A) $14.86
B) $16.84
C) $17.16
D) $39.27
E) $80.00

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