Consider a corporate bond that was purchased last year with a face value of $1,000,8% annual coupon rate and a 14-year maturity. At the time of purchase, the band had an expected yield to maturity of 7%. Calculate the rate of return that would have been eamed for the past year if the bond was sold today for $1,080.40. In order to use your financial calculator to solve for the rate of return on this bond, you need to know the following information: N: the number of years before the bond matures I/Y: the market rate of the interest on the bond PV: the present value of the bond PMT: the dollars of interest paid each year FV: the par, or maturity, value of the bond First, you must solve for the present value of the bond: Complete the following table by selecting the appropriate values for N, 1/Y and PMT. Then use your financial calculator to solve for the present value of the bord, and complete the final row of the table. 1,000 Input Keystroke Output N I/Y PMT FV PV Now you have all of the information needed to calculate the rate of return that would have been earned for the past year if the bond was sold today for $1,080.40: Po: the original bond price P: the new bond price PMT: the dollars of interest paid each year This bond is trading at a to par value. Therefore, it has an expected capital Over time According to the video, which of the following equations are used to calculate a bond's rate of return: Rate of Return P, P,+PMT P O Rate of Return = P, PMT O Rate of Return=P, -P,+PMT O Rate of Return P, P, PMT P If your friend sold the bond today for $1,080.40, what is the dollar return she would have earned this past year? If your friend sold the bond today for $1,080.40, what is the rate of return she would have earned this past year