Part 1:

Your client is considering the purchase of a bond that is currently selling for $1041.84. The client wants to know what annual rate of return can they expect to earn on the bond. The bond has 15 years to maturity, pays a coupon rate of 7.1% (payments made semi-annually), and a face value of $1000. (Round to 100th of a percent and enter your answer as a percentage, e.g., 12.34 for 12.34%)

Answer:

Part 2:

Your business manager forwards the following information to you. Your businesses earned a real rate of return of 5.3% last year and inflation for the same period was What was your nominal rate of return? (Note: nominal rates of return can be positive or negative.) (Use the exact method rather than the approximation method here.) (Round to 100th of a percent and enter as a percentage, e.g. 12.34% as 12.34

Answer:

Your business manager forwards the following information to you. Your businesses earned a real rate of return of 5.3% last year and inflation for the same period was 7.2%. What was your nominal rate of return? (Note: nominal rates of return can be positive or negative.) (Use the exact method rather than the approximation method here.) (Round to 100 th of a percent and enter as a percentage, e.g. 12.34\% as 12.34.) Answer: Your client is considering the purchase of a bond that is currently selling for $1041.84. The client wants to know what annual rate of return can they expect to earn on the bond. The bond has 15 years to maturity, pays a coupon rate of 7.1% (payments made semi-annually), and a face value of $1000. (Round to 100 th of percent and enter your answer as a percentage, e.g., 12.34 for 12.34% )