An investor purchases a bond at a price above par value. Two years later, the investor sells the bond. Th e resulting capital gain or loss is measured by comparing the price at which the bond is sold to the:

A . carrying value.

B . original purchase price.

C . original purchase price value plus the amortized amount of the premium.

Th e following information relates to Problems 4–6 An investor purchases a nine-year, 7% annual coupon payment bond at a price equal to par value. After the bond is purchased and before the fi rst coupon is received, interest rates increase to 8%. Th e investor sells the bond after fi ve years. Assume that interest rates remain unchanged at 8% over the fi ve-year holding period.