Answered step by step
Verified Expert Solution
Question
1 Approved Answer
1. You buy a bond with 3 years left to maturity and a yield to maturity of 6% for $920. After 1 year you
1. You buy a bond with 3 years left to maturity and a yield to maturity of 6% for $920. After 1 year you receive a coupon payment of $30 and sell the bond for $940. What was your rate of return on the bond? Question options: a. b. 1.05% 2% C. 5% d. 5.43% 3% 2. You buy a stock for $45. The following year you sell it at again at $45 plus $0 and you receive a dividend of 7. Your rate of return was: Give your answer with two decimals and with no $ or %. Note for instance that 10% = 0.1 = 10 should be written as 10.00. Edit
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Your rate of return on the bond was 543 Heres how to calculate it Total cash received Add the coupo...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started