Which one of the following is the rate of return an investor earns on a bond...
Which one of the following is the rate of return
an investor earns on a bond before adjusting for
inflation:
Nominal Rate
Dirty rate
YTMxm
Clean rate
Homework Answers
The correct answer is Nominal rate.
Explanation:
The return earned on an investment before any adjustment for inflation is called as the nominal rate of return. When inflation is adjusted in the nominal rate, we get the real rate of return.
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Which one of the following is the rate of return
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c) On the 01/09/2008 an investor is purchasing a bond from a seller; the last coupon on the bond was paid on the 01...
c) On the 01/09/2008 an investor is purchasing a bond from a seller; the last coupon on the bond was paid on the 01/ 05/2008 and the maturity date is 01/ 05/2012. The bond has a coupon rate of 10% and nominal value K1, 000. The yield to maturity is equal to 8%. (2.5 marks) Determine the dirty price paid by the buyer. i. (2.5 marks) i. Calculate the accrued interest.
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