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Assume you purchase (at par) one 15-year bond with a 6.25 percent coupon and a $1,000 face value. Suppose you are only able to reinvest
Assume you purchase (at par) one 15-year bond with a 6.25 percent coupon and a $1,000 face value. Suppose you are only able to reinvest the coupons at a rate of 4.25 percent. If you sell the bond after 10 years when the yield to maturity is 7.25 percent, what is your realized yield? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Answer is complete but not entirely correct. FV Selling price Realized yield $ $ 768.82 958.68 5.62 %
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