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An investor purchases a S1.000 5-year bond for $960. At the end of the calendar year. the investor notices that the bond is now trading
An investor purchases a S1.000 5-year bond for $960. At the end of the calendar year. the investor notices that the bond is now trading at S980. Nhich of the followving statements correctly describes the taxation of this change in value for the investor? a) The investor must report interest earnings of $20 b) The investor must report a capital gain of $20 c) There is no amount taxable because he hasn't sold the bond. Page 18 of 36 d) The investor must Rport interest earnings of $40
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