You purchased a bond for $1,200. The bond has a coupon rate of 7 percent, which is paid semiannually. It matures in 8 years and has a par value of $1,000. What is your expected rate of return?

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
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You purchased a bond for $1,200. The bond has a coupon rate of 7 percent, which is paid
semiannually. It matures in 8 years and has a par value of $1,000. What is your expected rate
of return?
Transcribed Image Text:You purchased a bond for $1,200. The bond has a coupon rate of 7 percent, which is paid semiannually. It matures in 8 years and has a par value of $1,000. What is your expected rate of return?
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