Question

Last year Janet purchased a $1,000 face value corporate bond with
an 7% annual coupon rate and a 15-year maturity. At the time of the
purchase, it had an expected yield to maturity of 7.42%. if janet
sold the bond today for $991.19, what rate of return would she have
earned for the past year? round your answer to two decimal
places.

Answer #1

Bond's Purchase Value = PV of Coupon Payment + PV of Maturity Value

= [Periodic Coupon Payment * {(1 - (1 + r)^-n) / r}] + [Face Value / (1 + r)^n]

= [{7%*$1,000} * {(1 - (1 + 0.0742)^-(15)) / (0.0742)}] + [$1,000 / {1 + (0.0742)}^(15)]

= [$70 * {0.6582 / 0.0742}] + [$1,000 / 2.9260]

= [$70 * 8.8711] + $341.76

= $620.98 + $341.76 = $962.74

Rate of Return earned = [Sale Price - Purchase Price + Coupon Interest] / Purchase Price

= [$991.19 - $962.74 + $70] / $962.74

= $98.45 / $962.74 = 0.1023, or 10.23%

Last year Janet purchased a $1,000 face value corporate bond
with an 7% annual coupon rate and a 20-year maturity. At the time
of the purchase, it had an expected yield to maturity of 13.05%. If
Janet sold the bond today for $1,133.42, what rate of return would
she have earned for the past year?

Last year Janet purchased a $1,000 face value corporate bond
with a 7% annual coupon rate and a 20-year maturity. At the time of
the purchase, it had an expected yield to maturity of 6.89%. If
Janet sold the bond today for $1,100.22, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.
%

Last year Janet purchased a $1,000 face value corporate bond
with an 7% annual coupon rate and a 10-year maturity. At the time
of the purchase, it had an expected yield to maturity of 12.5%. If
Janet sold the bond today for $1,137.79, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.
________%

Last year Janet purchased a $1,000 face value corporate bond
with an 7% annual coupon rate and a 25-year maturity. At the time
of the purchase, it had an expected yield to maturity of 12.54%. If
Janet sold the bond today for $1,091.2, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.

Last year Janet purchased a $1,000 face value corporate bond
with an 10% annual coupon rate and a 15-year maturity. At the time
of the purchase, it had an expected yield to maturity of 7.95%. If
Janet sold the bond today for $1,104.19, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.

Last year Janet purchased a $1,000 face value corporate bond
with an 11% annual coupon rate and a 15-year maturity. At the time
of the purchase, it had an expected yield to maturity of 11.72%. If
Janet sold the bond today for $1,119.27, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.
%

Last year Janet purchased a $1,000 face value corporate bond
with an 11% annual coupon rate and a 15-year maturity. At the time
of the purchase, it had an expected yield to maturity of 13.96%. If
Janet sold the bond today for $1,023.28, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places. %

Last year Janet purchased a $1,000 face value corporate bond
with an 8% annual coupon rate and a 15-year maturity. At the time
of the purchase, it had an expected yield to maturity of 12.44%. If
Janet sold the bond today for $1,021.35, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.

BOND RETURNS
Last year Janet purchased a $1,000 face value corporate bond
with an 7% annual coupon rate and a 20-year maturity. At the time
of the purchase, it had an expected yield to maturity of 9.73%. If
Janet sold the bond today for $990.49, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.

Last year Janet purchased a $1,000 face value corporate bond
with an 12% annual coupon rate and a 25-year maturity. At the time
of the purchase, it had an expected yield to maturity of 10.2%. If
Janet sold the bond today for $1,140.91, what rate of return would
she have earned for the past year? Do not round intermediate
calculations. Round your answer to two decimal places.

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 minutes ago

asked 4 minutes ago

asked 4 minutes ago

asked 5 minutes ago

asked 10 minutes ago

asked 10 minutes ago

asked 14 minutes ago

asked 19 minutes ago

asked 19 minutes ago

asked 19 minutes ago

asked 23 minutes ago

asked 23 minutes ago