You are planning to buy a corporate bond with a seven year maturity that pays 7 percent

Question:

You are planning to buy a corporate bond with a seven year that pays 7 percent interest. The bond is priced at $ 108,500 per $ 100,000 par value. You expect to sell the bond in two years when a similar risk five year bond is priced to yield 7.2 percent annually to Assuming that you can reinvest all cash flows at an 8 percent annual rate (4 percent semiannually), calculate your expected total return over the two- year holding period. Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...