What is the approximate market value for of a $1,000 corporate bond that pays 9 percent interest when comparable bonds are paying 8 percent?
A) $800
B) $900
C) $1,000
D) $1,125
E) $1,600

Question

Quizplus · Accepted Answer

The bond pays a higher interest rate (9%) than the market rate (8%), making it more valuable. The market value would be above the face value of $1,000, and $1,125 is the closest option reflecting this premium.

What Is the Approximate Market Value for of a $1,000