Suppose you purchase a 30 -year, zero-coupon bond with a yield to maturity of 6.5%. You hold the bond for five years before selling it. a. If the bond's yield to maturity is 6.5% when you sell it, what is the annualized rate of return of your investment? b. If the bond's yield to maturity is 7.5% when you sell it, what is the annualized rate of return of your investment? c. If the bond's yield to maturity is 5.5% when you sell it, what is the annualized rate of return of your investment? d. Even if a bond has no chance of default, is your investment risk free if you plan to sell it before it matures? Explain. a. If the bond's yield to maturity is 6.5% when you sell it, what is the annualized rate of return of your investment? The annualized rate of return of your investment is \%. (Round to two decimal places.) b. If the bond's yield to matunty is 7.5% when you sell it, what is the annualized rate of roturn of your imvestment? The annualized rate of return of your investment is \%. (Round to two decimal places.) c. If the bond's yield to maturity is 5.5% when you sell it, what is the annualized rate of return of your investment? Then the annualized rate of return of your investment is %. (Round to two decimal places.) d. Even if a bond has no chance of default, is your investment risk free if you plan to sell it before it matures? Explain. (Solect the best choice below) Suppose you purchase a 30 -year, zero-coupon bond with a yield to maturity of 6.5%. You hold the bond for five years before selling it. a. If the bond's yield to maturity is 6.5% when you sell it, what is the annualized rate of return of your investment? b. If the bond's yield to maturity is 7.5% when you sell it, what is the annualized rate of return of your investment? c. If the bond's yield to maturity is 5.5% when you sell it, what is the annualized rate of return of your investment? d. Even if a bond has no chance of default, is your investment risk free if you plan to sell it before it matures? Explain. a. If the bond's yield to maturity is 6.5% when you sell it, what is the annualized rate of return of your investment? The annualized rate of return of your investment is \%. (Round to two decimal places.) b. If the bond's yield to matunty is 7.5% when you sell it, what is the annualized rate of roturn of your imvestment? The annualized rate of return of your investment is \%. (Round to two decimal places.) c. If the bond's yield to maturity is 5.5% when you sell it, what is the annualized rate of return of your investment? Then the annualized rate of return of your investment is %. (Round to two decimal places.) d. Even if a bond has no chance of default, is your investment risk free if you plan to sell it before it matures? Explain. (Solect the best choice below)
