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You purchase a $1,000 par-value bond with a 6% coupon rate, semiannual coupons and one year to maturity. The bonds price was $1003.84 when you
You purchase a $1,000 par-value bond with a 6% coupon rate, semiannual coupons and one year to maturity. The bonds price was $1003.84 when you bought it. Six months later, you receive the coupon payment and then immediately sell the bond. The bonds YTM upon sale was 6.2% (expressed as an APR with semiannual compounding).
(a) What was the price of the bond when you sold it?
(b) What is your 6-month return on the bond?
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