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Consider the following yields to maturity on various one-year zero-coupon securities:

-The price (expressed as a percentage of the face value)of a one-year, zero-coupon corporate bond with a AAA rating is closest to:

Question

Use the table for the question(s)below.
Consider the following yields to maturity on various one-year zero-coupon securities:
 
-The price (expressed as a percentage of the face value)of a one-year, zero-coupon corporate bond with a AAA rating is closest to:

Quizplus · Accepted Answer

Zero-coupon bonds are priced based on the present value of the bond's face value, discounted by the yield to maturity (YTM). A AAA-rated corporate bond would have a low YTM due to its high credit quality, suggesting a price close to but less than 100% of its face value. Among the given options, 95.17% is the closest to this description.

Use the Table for the Question(s)below