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If you purchased a zero coupon bond today for $225 and it matures at $1,000 in 11 years, what rate of return will you earn on that bond (to the nearest 1/10 of 1 percent)?

 Nov 14, 2015

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 #2
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+10

I assume that this is you again NeedSupply.

Your questions are unmistakable.  Posting anonymously does not make any difference.

Post one question at a time like 'guest' told you to and work WITH us to show us that you are participating in your own learning.

We are not here to do all the questions in your textbook for you!  You will learn nothing that way anyhow!

 Nov 14, 2015
 #1
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The rate of return on this stripped coupon is:14.52% compounded annually.

 Nov 14, 2015
 #2
avatar+118723 
+10
Best Answer

I assume that this is you again NeedSupply.

Your questions are unmistakable.  Posting anonymously does not make any difference.

Post one question at a time like 'guest' told you to and work WITH us to show us that you are participating in your own learning.

We are not here to do all the questions in your textbook for you!  You will learn nothing that way anyhow!

Melody Nov 14, 2015

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