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Last year Janet purchased a $1,000 face value corporate bond with an 7% annual coupon rate...

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 8.86%. If Janet sold the bond today for $1,145.38, what rate of return would she have earned for the past year? Do not round intermediate calculations. Round your answer to two decimal places.

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Answer #1

add: less: value at today coupon Purchase value Total dollar return $1,145.38 $70.00 $828.50 70*(1-(1/(1.0886420)}}/0.0886+(1

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