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You purchased a bond 87 days ago for $942.41. You received an interest payment of $16.00...

You purchased a bond 87 days ago for $942.41. You received an interest payment of $16.00 86 days ago. Today the bond’s price is $1,156.14. What is the holding period return (HPR) on the bond as of today? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) HPR %.

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Answer #1

Initial price = $942.41

Interest income = $16

End of period value = $1156.14

So holding period return = (Income + End of period value - Initial Value)/Initial value

SO, HPR = (16+1156.14-942.41)/942.41 = 0.2438 or 24.38%

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