A mortgage bond issued by Automation Engineering is for sale for $8200. The bond has a face value of $10,000 with a coupon rate of 8% per year, payable annually. What rate of return will be realized if the purchaser holds the bond to maturity 5 years from now?
What will be an ideal response?
0 = -8200 + 10,000(0.08)(P/A,i*,5) + 10,000(P/F,i*,5)
Solve by trial and error or IRR function
i* = 13.1% per year (spreadsheet)
Trades & Technology
You might also like to view...
Output driver modules are capable of controlling up to ____________________ separate outputs
Fill in the blank(s) with the appropriate word(s).
Trades & Technology
Which winding of a transformer is connected to the load?
a. Mutual b. Positive c. Secondary d. Primary
Trades & Technology
What motors are the simplest, most rugged, and most common?
A) Mechanical motors B) Induction motors C) Self-propelled motors D) Intrinsic motors
Trades & Technology
When driving in fog, snow, or rain, you should use your:
a. running lights b. high-beam headlights c. low-beam headlights
Trades & Technology