Question: What is the 1 year total return for a $1,000 face value bond with a coupon rate of 4.25% that we buy for $1,012 and

What is the 1 year total return for a $1,000 face value bond with a coupon rate of 4.25% that we buy for $1,012 and sell one year later for $995? A.-.68% B.-2.02% OC.2.52% OD.2.86%

What is the 1 year total retum for a $1,000 face value bond with a coupon rate of 4.25% that we buy for $1,012 and sell one year later for $995 ? A. .68% A. 2.02% C. 252% 0.286%

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

During 2020, you were hired as the Chief Financial Officer for MC Travel Inc., a fairly young travel company that is growing quickly. A key accounting staff member has prepared the financial...

You sell a bond for $1100 and place it in an account that yields 10% per year. What is the future value of this amount in 2 months? In 2 years? A $1000 face value bond with 10% coupon rate and...

oo 2 1. On August 29th, 2020, you buy a share of Emerge Energy Services Stock (EMES) after getting a hot tip. The purchase price was $144.17. After what was a bit of a tough year, you sell the stock...

QUESTION FOUR a.Consider an 8-year, 12 percent coupon bond with a par value of $100 on which interest is payable semi-annually.The required return on this bond is 14.What is the value of the bond?...

Homework on time value of Money 1 . What is the present value of a loan that calls for the payment of $ 5 0 0 per year for six years if the discount rate is 1 0 percent and the first payment will be...

2 1. One 21, 2014, share of Forge Fer Services Stock (EMES) after en het in the chosence sans he was a bit of a rough you, you does took the AA TIMES pad dividend of $1.25 the day before you sold...

bond currently has 10 years to maturity, a $1000 face value and a 10% coupon rate. The bond pays coupons annually. The table below shows the yield to maturity for the next 5 years. You will determine...

Question 2 (10 points) Calculate the following 2024, with a face value of $100, a coupon rate of A. The price of a bond that matures in 2024, with a face value of 4.5 per cent and a yield to maturity...

= | Paragraph Kl 1. bond currently has 10 years to maturity, a $1000 face value and a 10% coupon rate. The bond pays coupons annually. The table below shows the yield to maturity for the next 5...

Integrative Case This case draws on material from Chapters 14 and 15 On May 8, 1984, Hannah Eisenstat graduated from Louisiana State University. She set to work opening a coffee shop in Baton Rouge...

QUESTION 2 1 What is the 1 year total return for a $ 1 , 0 0 0 face value bond with a coupon rate of 5 . 2 3 % that we buy for $ 1 , 0 3 2 and sell one year later for $ 9 7 5 ? A . - . 4 6 % B . - 2...

M issued a check for P1,000.00 to P. P went to McJolibi and ordered McChikenjoy. At the counter, P realized that he left his wallet at the car and all he had with him was the check. P asked the...

Norton Parts, Inc., manufactures tenders for mobile processes: Each fender passes through three processes: Molding, Drilling, and Painting. In March, the Molding Department of the Detroit plant...

Suppose Thomas buys a bond issued by \ ( \ times \ ) Corp. for \ ( \ $ 5 0 \ ) in the primary market. Which of the following statements best describes this transaction? \ ( \ times \ ) Corp. has...

Brite Toothbrushes has gathered the following information to complete its Production Report for the month of April. Assume all materials are added at the beginning of the process. Required: Using the...