Answer:
Bond Price = $580.2640476 rounded off to $580.26
Explanation:
A zero coupon bond is a kind of bond that does not pay interest to the bond holder like other bonds. Instead it is offered at a discount price and pays the par value at maturity. The discount price is calculated using a certain rate which can also be called the implied interest rate on this zero coupon bond. The formula to calculate the price of the zero coupon bond is,
Bond Price = Par Value / (1 + r)^t
Where,
- r is the interest rate or the discount rate
- t is the number of periods to maturity
Bond Price = 1000 / (1+0.115)^5
Bond Price = $580.2640476 rounded off to $580.26
Answer:
a. adds $10,000 in bank reserves.
Explanation:
Given that
Reserve requirement is 20%
Now if you want to pay back the loan of $10,000 so here the act of paying back the loan is that the amount of loan i.e. $10,00 would get added to the bank reserves
Therefore as per the given situation, the option a is correct
And, the same is to be considered
Thus, all the other options are incorrect
I don’t even know to be honest only commenting to get some points ....:
Explanation:
Capital: The most important city or town of a country or region.
Capital goods: Goods that are used in producing other goods, rather than being bought by consumers