One year ago, you purchased a two-year bond issued by BlueWave Inc. at a discount for $850. The bond has a par value of $1,000 and one year left until maturity. The bond pays $60 in interest at maturity. If the interest rate is 6% per year, what is your capital gain or loss?

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 9P
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What is your capital gain or loss on these financial accounting question?

One year ago, you purchased a two-year bond
issued by BlueWave Inc. at a discount for $850.
The bond has a par value of $1,000 and one year
left until maturity. The bond pays $60 in interest at
maturity. If the interest rate is 6% per year, what is
your capital gain or loss?
Transcribed Image Text:One year ago, you purchased a two-year bond issued by BlueWave Inc. at a discount for $850. The bond has a par value of $1,000 and one year left until maturity. The bond pays $60 in interest at maturity. If the interest rate is 6% per year, what is your capital gain or loss?
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