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Sergio039
2 months ago
8

Last year a certain bond with a face value of $5,000 yielded 8 percent of its face value in interest. If that interest was appro

ximately 6.5 percent of the bond's selling price, approximately what was the bond's selling price?
Business
1 answer:
Scilla [3.8K]2 months ago
8 0

Answer:

The selling price of the bond is $6,154

Explanation:

Given data

face value = $5,000

interest = 8% of face value

rate = 6.5%

To determine

the bond's selling price

solution

we will calculate the interest associated with

interest = 8% of face value

interest = 8% × 5,000

interest = 400

Let’s assume the bond’s selling price is x

where

the bond selling equation will be

interest = rate × bond selling price

400 = 0.065 × x

x = 6,154

Thus, the bond’s selling price is $6,154

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