Which of the following best shows the timeline for cash flows from a five-year bond with a face
value of $2,000, a coupon rate of 4.2%, and semiannual payments?

Question

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The bond has a face value of $2,000 and a coupon rate of 4.2%. The semiannual coupon payment is $42 ($2,000 x 4.2% / 2). The bond has a maturity of 5 years, so there will be 10 semiannual coupon payments. The timeline for the cash flows is:0: -$2,000 (purchase price)1: +$42 (first semiannual coupon payment)2: +$42 (second semiannual coupon payment)3: +$42 (third semiannual coupon payment)...9: +$42 (ninth semiannual coupon payment)10: +$2,042 (tenth semiannual coupon payment and return of principal)

Which of the Following Best Shows the Timeline for Cash