Sara decides to buy a 6 percent, 10-year straightcoupon bond for $100, which pays annual coupons of

Question:

Sara decides to buy a 6 percent, 10-year straightcoupon bond for $100, which pays annual coupons of $6 at the end of each year. At the end of the first year, the bond is trading at $115. At the end of the second year, the bond trades at $100.

a. What is Sara’s return over the first year?

b. What is Sara’s return over the second year?

c. What is the average return per year for the twoyear period? Use the arithmetic average.

AppendixLO1

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Answer rating: 100% (QA)

Answered By

Cyrus Sandoval

I a web and systems developer with a vast array of knowledge in many different front end and back end languages, responsive frameworks, databases, and best code practices. My objective is simply to be the best web developer that i can be and to contribute to the technology industry all that i know and i can do. My skills include: - Front end languages: css, HTML, Javascript, XML - Frameworks: Angular, Jquery, Bootstrap, Jasmine, Mocha - Back End Languages: Java, Javascript, PHP,kotlin - Databases: MySQL, PostegreSQL, Mongo, Cassandra - Tools: Atom, Aptana, Eclipse, Android Studio, Notepad++, Netbeans. Having a degree in Computer Science enabled me to deeply learn most of the things regarding programming, and i believe that my understanding of problem solving and complex algorithms are also skills that have and will continue to contribute to my overall success as a developer. I’ve worked on countless freelance projects and have been involved with a handful of notable startups. Also while freelancing I was involved in doing other IT tasks requiring the use of computers from working with data, content creation and transcription.

5.00+ 1+ Reviews 10+ Question Solved

Related Book For book-img-for-question