escambia county $1,000 bonds are selling at 109.443. what is the market price of one such bond? a. $1,109.44…

escambia county $1,000 bonds are selling at 109.443. what is the market price of one such bond? a. $1,109.44 b. $1,000.00 c. $109.44 d. $1,094.43

escambia county $1,000 bonds are selling at 109.443. what is the market price of one such bond? a. $1,109.44 b. $1,000.00 c. $109.44 d. $1,094.43

Answer

Explanation:

Step1: Understand bond - price notation

Bonds are often priced as a percentage of their face - value. Here, the bond is selling at 109.443, which means 109.443% of the face - value.

Step2: Calculate the market price

The face - value of the bond is $1000. To find the market price, we multiply the face - value by the percentage (in decimal form). The percentage 109.443% in decimal form is 1.09443. So the market price $P$ is $P = 1000\times1.09443$. $P=1000\times1.09443 = 1094.43$

Answer:

d. $1,094.43$