You buy a 2.5% coupon bond at a price of $97. One year from today, the price is higher - at $104. Assume par value is $1...

Question

Question

You buy a 2.5% coupon bond at a price of $97. One year from today, the price is higher - at $104. Assume par value is $100.

What is the total return of the bond? (respond in whole numbers - i.e 4.15% => type 4.15)

Answer 1

Answer #1

rate of return/HPR = ((Selling price+Coupon amount)/Purchase price-1)

=((104+2.5)/97-1)

=9.79%

Answer 2

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