The British Government Has a Consol Bond Outstanding That Pays

Multiple Choice

The British government has a consol bond outstanding that pays ₤100 in interest each year.Assuming that the current interest rate in Great Britain is 5% and that you will receive your first interest payment immediately upon purchasing the consol bond,then the value of the consol bond is closest to:

A) ₤2000.
B) ₤2100.
C) ₤1000.
D) ₤1100.