Question
7-33: Marty bought a 6.75%, $10000 20-year bond for $7500 with 18 years maturity. The interest was payable quarterly and was based on the $10000.
7-33: Marty bought a 6.75%, $10000 20-year bond for $7500 with 18 years maturity. The interest was payable quarterly and was based on the $10000. The bond was kept for only 12 years and sold for $8750 immediately after the 48th interest payment was received.
(a) What is the nominal rate of return per year were made on this investment?
(b) What is the effective rate of return per year were made on this investment?
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
