Janice V. bought a 5% $1000 twenty-year bond for $925. She received a semiannual dividend for 8 years, then sold it immediately after the 16th dividend for $800. What rate of return did she make (a) per semiannual period, and (b) per year (nominal)?
Janice V. bought a 5% $1000 twenty-year bond for $925. She received a semiannual dividend for 8 years, then sold it immediately after the 16th dividend for $800. What rate of return did she make (a) per semiannual period, and (b) per year (nominal)?
Chapter7: Stocks (equity) - Characterstics And Valuation
Section: Chapter Questions
Problem 2PROB
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Janice V. bought a 5% $1000 twenty-year bond for
$925. She received a semiannual dividend for
8 years, then sold it immediately after the 16th
dividend for $800. What
make (a) per semiannual period, and (b) per year
(nominal)?
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