What is the cost of the bond?
When you see that a bond was purchased "at 92", this means that the bond was purchased for 92% of the face value. Sometimes the bond purchaser will pay more than the face value (purchased a number greater than 100), generally if the interest rate is higher than the market rate.
The cost of one bond, then, is 92% of 1,000, or $920.
Since there are 6 bonds, the total cost is 920 x 6 = $5520
What is the total annual interest?
The annual interest is the interest rate on the bond times the face value (not the cost of the bond).
The interest rate is 6.5%, so the annual interest on one bond is:
6.5% x 1000 = $65
6 bonds: $65 x 6 = $390
When we think of yield, we want to consider the real return on the bond. This is the annual interest earned divided by what the purchaser paid for it.
The purchaser paid $5520 for the bonds, and is earning $390.
390 ÷ 5520 = 7.06%.
Note that we can also calculate the return on one bond, rather than the total cost and interest of 6 bonds, and get the same result.
65 ÷ 920 = 7.06%
Answer:
questions 2 answe is x+3less than equal to 13
Answer:
<u>-58</u>
Step-by-step explanation:
-32+(-4+7)(2)
-32 + 3(2)
-29 x 2
<u>-58</u>
Answer:
175°F
Step-by-step explanation:
The difference between -82 and 0 is 82.
The difference between 0 and 93 is 93.
Add these two numbers together to find the total difference:
82 + 93
= 175
So, the difference is 175°F
Answer:
See the explanation
Step-by-step explanation:
Please see the photo
