You own a bond that has a par value of $ 1,000 and matures in 5 years It pays a 5 percent annual coupon rate The bond currently sells for $ 1,100 What is the bonds expected rate of return ...

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You own a bond that has a par value of $ 1,000 and matures in 5 years.

Question:

You own a bond that has a of $ 1,000 and matures in 5 years. It pays a 5 percent annual rate. The bond currently sells for $ 1,100. What is the bond’s expected rate of return?
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... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...