Question

A Treasury bond that you own at the beginning of the year is worth $1,020. During the year, it pays $32 in interest payments and ends the year valued at $1,030.

  

What was your dollar return and percent return? (Round your percent return answer to 2 decimal places.)

Answer 1

1)

Dollar return = Ending value + interest - beginning value

Dollar return = $1,030 + 32 - $1,020

Dollar return = $42.00

2)

Percent return = (Dollar return / beginning value) * 100

Percent return = (42 / 1020) * 100

Percent return = 4.12%