Alexandra bought a 7-year bond at a 7.50% discount to its par value of $1,000 three years ago. The bond has a 4.70% coupon rate payable semiannually. What was her effective annual rate of return if she sells the bond today for $1,090? Assume coupons are not reinvested.

Answer rating: 100% (QA)

To calculate the effective annual rate of return for Alexandras bond investment we need to consider ... View the full answer