The dollar price of a $1,000.00 face value bond is 991.25. This bond is listed at _______.
A. 99 2/5
B. 99 12/5
C. 99 1/2
D. 99 1/8
99 1/8. 1/8 is the fraction version of .125, so with 991.25, you have to move the decimal point to the right so the last number is in the thousandth place. 99.125 then convert the .125 to a fraction.
To solve this problem, we need to find the percentage of the face value that the bond is selling for. We can do this by dividing the dollar price of the bond by the face value, and then multiplying by 100.
The calculation would be:
(991.25 / 1000) * 100 = 99.125
Therefore, the bond is listed at 99.125% of its face value.
Now, let's convert this fractional percentage into a mixed number.
First, we convert the decimal part into a fraction. The decimal 0.125 can be expressed as 125/1000.
Then, we add the whole number (99) to the fraction: 99 + 125/1000.
Now let's simplify the fraction 125/1000. We can divide the numerator and the denominator by their greatest common divisor (GCD), which is 25:
125 ÷ 25 / 1000 ÷ 25 = 5/40.
Simplifying 5/40, we divide the numerator and the denominator by their greatest common divisor (GCD), which is 5:
5 ÷ 5 / 40 ÷ 5 = 1/8.
Therefore, the bond is listed at 99 1/8.
Hence, the answer is D. 99 1/8.