What Is the Rate of Return on a Bond with a Coupon

question 82

Multiple Choice

What is the rate of return on a bond with a coupon of $55 that was purchased for $900 and sold one year later for $950?

• A) 5.56%
• B) 6.11%
• C) 11.67%
• D) 12.43%

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Definitions:

Cognitive

Pertaining to the mental processes involved in acquiring knowledge and understanding through thought, experience, and the senses.

Depression

A mental condition characterized by an unrelenting gloomy mood or a disconnection from regular activities, which significantly impairs normal life.

Notebook

A notebook is a book or stack of paper pages that are often ruled, used for purposes such as recording notes or memoranda, writing, drawing, or scrapbooking.

Electroconvulsive Therapy

A psychiatric treatment involving electrically induced seizures intended primarily for severe mental disorders, including major depression and bipolar disorder.