What rate of return did the original purchaser actually earn

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Reference no: EM131913233

A 15 year bond has a face value of $50000 and semi-annual coupons of $1250. find the purchase price if the buyer's annual rate of return is 0.054. After 5 years the original purchaser sells the bond to an investor who aims for an annual return rate of 0.06.

Find the sale price.

What rate of return did the original purchaser actually earn?

Divide the 4^th coupon payment into interest and principal adjustment.

Reference no: EM131913233

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