An investor buys a $1000 face value bond paying a semi-annual coupon at 9% APR compounded semi-annually for $1250. Four years later, just after receiving his 8th coupon payment, the investor sells the bond for $924.00. What realized yield did the investor earn, stated as an APR with semi-annual compounding?
An investor buys a $1000 face value bond paying a semi-annual coupon at 9% APR compounded semi-annually for $1250. Four years later, just after receiving his 8th coupon payment, the investor sells the bond for $924.00. What realized yield did the investor earn, stated as an APR with semi-annual compounding?
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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An investor buys a $1000 face
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