You purchased a $1000 face value zero-coupon bond one year ago for $260.3. The market interest rate is now 7.36 percent. If the bond had 19 years to maturity when you originally purchased it, what was your total return for the past year?Assume semiannual compounding. Answer as a percentage to two decimals (if you get -0.0435, you should answer -4.35).

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
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You purchased a $1000 face value zero-coupon bond one year ago for $260.3. The market interest
rate is now 7.36 percent. If the bond had 19 years to maturity when you originally purchased it, what
was your total return for the past year?Assume semiannual compounding. Answer as a percentage to
two decimals (if you get -0.0435, you should answer -4.35).
Transcribed Image Text:You purchased a $1000 face value zero-coupon bond one year ago for $260.3. The market interest rate is now 7.36 percent. If the bond had 19 years to maturity when you originally purchased it, what was your total return for the past year?Assume semiannual compounding. Answer as a percentage to two decimals (if you get -0.0435, you should answer -4.35).
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