An investor purchases a 30-year, zero-coupon bond with a face value of $5000 and a yield to maturity of 8.4%. He sells this bond ten years later. What is the rate of return on his investment, assuming yield to maturity does not change?

A) 6.72%
B) 5.04%
C) 8.40%
D) 4.20%


Answer: C

Business

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