A) In January 2021 you purchased a $50,000 bond from Walmart with a 3% coupon rate and a 5-year maturity. In December of 2021, you sold this bond in the secondary market for $45,455. What was the yield on the bond that you sold?
A) In January 2021 you purchased a $50,000 bond from Walmart with a 3% coupon rate and a 5-year maturity. In December of 2021, you sold this bond in the secondary market for $45,455. What was the yield on the bond that you sold?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A) In January 2021 you purchased a $50,000 bond from Walmart with a 3% coupon rate and a 5-year maturity. In December of 2021, you sold this bond in the secondary market for $45,455. What was the yield on the bond that you sold?
B) Assume you have obtained a summer internship 20 miles from your house and you are considering purchasing a new car using a car loan. The interest rate for the car loan is currently 3% and your roommate suggested you secure the loan now since interest rates will most definitely increase by the time summer arrives. Do you agree with her, and if so, what factors are you considering?
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