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Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity)
Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity) decline from 9 percent to 8 percent. a. What is the bond price at 9 percent? Answer is complete and correct. Bond $1,091.29 price b. What is the bond price at 8 percent? Answer is complete and correct. Bond $ 1,196.36 price c. What would be your percentage return on investment if you bought when rates were 9 percent and sold when rates were 8 percent? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Answer is not complete. Return on investment 9.63%
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