Which of the following best shows the timeline for cash flows from a five-year b
ID: 2792153 • Letter: W
Question
Which of the following best shows the timeline for cash flows from a five-year bond with a face value of
$5000
,
a coupon rate of
5.4 %
,
and semiannual payments?
A.
Period
0
1
2
3
4
5
nothing
nothing
$ 270
$ 270$ 270
270
$ 5,270
nothing
nothing
nothing
nothing
nothing
nothing
nothing
B.
Period
0
1
2
3
nothing
9
10
nothing
nothing
$ 270
$ 270$ 270
nothing
$ 270
$ 5,270
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
C.
Period
0
1
2
3
nothing
9
10
nothing
nothing
$ 135
$ 135$ 135
nothing
$ 135
$ 135
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
D.
Period
0
1
2
3
nothing
9
10
nothing
nothing
$ 135
$ 135$ 135
nothing
$ 135
$ 5,135
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
Explanation / Answer
Cash flows Year - 0 135.00 1 135.00 2 135.00 3 135.00 4 135.00 5 135.00 6 135.00 7 135.00 8 135.00 9 5,135.00 10
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