An Investor Buys a Five-Year, 9 Percent Coupon Bond for $975

question 104

Multiple Choice

An investor buys a five-year, 9 percent coupon bond for $975, holds it for one year and then sells the bond for $985.What was the investor's rate of return?

• A)9.00 percent
• B)9.23 percent
• C)9.65 percent
• D)10.26 percent

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Definitions:

Experimental Group

In scientific research, the group of subjects who receive the treatment or intervention being tested, as opposed to a control group.

Control Group

In experimental research, a group of subjects that does not receive the experimental treatment and is compared to the group that does, to measure the effect of the treatment.

Reversal Design

A method in experimental analysis where an intervention is introduced, removed, and then reintroduced to determine its effect on behavior.