Multiple Choice
The price of a bond is equal to the sum of the present values 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 the bond if the interest rate is 5 percent?
A) $1,050.00
B) $1,045.35
C) $1,000.00
D) $945.35
Correct Answer:
Verified
Correct Answer:
Verified
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