An Investor Purchases a 30-Year,zero-Coupon Bond with a Face Value

question 29

Multiple Choice

An investor purchases a 30-year,zero-coupon bond with a face value of $1000 and a yield to maturity of 6.5%.He sells this bond ten years later.What is the internal rate of return (IRR) on his investment,assuming yield to maturity does NOT change?

• A)6.04%
• B)6.24%
• C)6.50%
• D)6.62%
• E)6.74%

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