Solution-What is the actual rate of return

What is the actual rate of return

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Reference no: EM13342574

Please answer the following question using one of the four answers listed below

You buy an 8% annual coupon bond from CARRIS Inc. that has a 25 year maturity and a required return of 12%. The par value is $1,000. You sell the bond five years later when the required return is 10%. What is the actual rate of return (or holding period return) over this 5 year period? Round to the nearest percent. (This will be easier to answer if you've already answered the other two questions regarding the CARRIS bond.)

1) 41%

2) 79%

3) 13%

4) 33%

Reference no: EM13342574

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What is the actual rate of return

Reference no: EM13342574

Reference no: EM13342574

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