[Answer] 100. You purchased an annual interest coupon bond one year ago that had 9 years remaining to maturity at that time. The coupon interest rate was 10% and the par value was $1 000. At the time you purchased the bond the yield to maturity was 8%. If you sold the bond after receiving the first interest payment and the yield to maturity continued to be 8% your annual total rate of return on holding the bond for that year would have been _________. A. 8.00%B. 7.82%C. 7.00%D. 11.95%E. None of these is correct.

Answer: A. 8.00%
100. You purchased an annual interest coupon bond one year ago that had 9 years remaining to maturity at that time. The coupon interest rate was 10% and the par value was $1 000. At the time you purchased the bond the yield to maturity was 8%. If you sold …

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