Multiple Choice
The price of a bond is equal to the sum of the present value of its future payments.Suppose a certain bond pays $50 one year from today,and $1,050 two years from today.What is the price of this bond if the interest rate is 5 percent?
A) $1,000
B) $1,050
C) $1,100
D) None of the above is correct.
Correct Answer:
Verified
Correct Answer:
Verified
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