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The yleld to maturity on a bond is the Interest rate you earn on your Investment If Interest rates do not change. If you actually
The yleld to maturity on a bond is the Interest rate you earn on your Investment If Interest rates do not change. If you actually sell the bond before it matures, your realized retum is known as the holding period yield. Suppose that today you buy a coupon bond with 9 percent annual Interest for $1,000. The bond has 12 years to maturity. Three years from now, the yleld to maturity has declined to 7 percent and you decide to sell. What is your holding period yleld? Multiple Choice 8.84 percent 9.49 percent 10.96 percent 13.01 percent 1283 percent
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