Value corporate bond with an annual coupon rate

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Reference no: EM131045660

At the beginning of the year, you bought a $1000 par value corporate bond with an annual coupon rate of 6 percent and a maturity date of 10 years. When you bought the bond, it had an expected yield to maturity of 8 percent. Today the bond sells for 1,060.

A) What did you pay for the bond?

B) If you sold the bond at the end of the year, what would be your one-period return on the investment? Assume that you did not receive any interest payment during the holding period.

Reference no: EM131045660

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