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prisoha [69]
3 years ago
11

One year ago, you purchased a 7 percent coupon bond with a face value of $1,000 when it was selling for 102.5 percent of par. To

day, you sold this bond for 104 percent of par. What is your total dollar return on this investment?
Business
1 answer:
cestrela7 [59]3 years ago
7 0

Answer:

Total Dollar return on Investment = $85

Explanation:

Coupon rate = 7%

Coupon Payment ($1,000×7%) = $70

Selling Price of the bond ($1,000×102.5)  = $1025

Today’s selling price of the bond ($1,000×104%) =$1,040

$1,040 - $1025 + $70 = $85

Total Dollar return on Investment = $85

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