To help pay for a new building, the Business School issues 20-year bonds paying a semiannual coupon rate of 4.4% (APR). You think they look like a great investment, so you purchase them at a premium for $1213 per bond, and you will hold them to maturity.

What will your EAR return be if all the coupons & principal are paid on time?

Answer rating: 100% (QA)

To calculate the Effective Annual Rate EAR of return for the bond investment we need to consider the following factors Coupon rate The annual percenta... View the full answer