Question
James McCulloch purchased a 30-year U.S. Treasury bond four years ago for $1,000. The bond paid 3.125 percent annual interest. Four years later he sold
James McCulloch purchased a 30-year U.S. Treasury bond four years ago for $1,000. The bond paid 3.125 percent annual interest. Four years later he sold the bond for $1,040.
(a) What is the annual interest amount for the bond? (Round your answer to 2 decimal places.) Annual interest $
(b) What is the total interest Mr. McCulloch earned during the four-year period? Total interest $
(c) What is the total return for Mr. McCulloch's bond investment?
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Money Banking And Financial Markets
Authors: Stephen G. Cecchetti
2nd International Edition
0071287728, 9780071287722
