Question: Arthur buys an 1 1 - year, $ 1 0 , 0 0 0 face value bond with 4 . 5 % annual coupons paid

Arthur buys an 11-year, $10,000 face value bond with 4.5% annual coupons paid semiannually and nominal yield compounded semiannually of 5.7%. He holds the bond long enough to collect six payments, then sells the bond. The nominal yield at time of sale is 5.0%. He must pay a $10 commission to sell the bond. Find the effective annual return on his original investment.
(a)0.0525
(b)0.0575
(c)0.0625
(d)0.0675
(e)0.0725
Arthur buys an 1 1 - year, $ 1 0 , 0 0 0 face

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