Consider a bond that promises to make coupon payments of $100 each year for three years (beginning in one year's time) and also repays the face value of $2000 at the end of the third year. If the market interest rate is 4 percent, what is the present value of this bond?
A) $1966.39
B) $1866.67
C) $2055.50
D) $1941.57
E) $288.45
Correct Answer:
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