If the final expressions in a present value equation used to calculate the price of a bond you are considering buying are "[$50 / (1 + .08) 3] + [$500 / (1 + .08) 3]," which of the following is correct?
A) The face value is $500,the coupon is $50,and the coupon will mature in 3 years.
B) The face value is $50,the interest rate you need is 8 percent,and the coupon will mature in 3 years.
C) The face value is $500,the interest rate you need is 3 percent,and the coupon will mature in 8 years.
D) The coupon is $50,the interest rate you need is 1.08 percent,and the coupon will mature in 3 years.
Correct Answer:
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