Lamar baily purchased a 7 percent coupon corporate bond


Lamar Baily purchased a 7 percent coupon corporate bond that matured in 10 years and paid interest semiannually. He paid $ 2,800 and six months later, immediately following an interest payment, he sold the bond. At the time of sale, the market interest rate on bonds of this type was 6 percent. What was Baily's selling price? What was Baily's rate of return for the six months? What is this return on an annual basis?

Solution Preview :

Prepared by a verified Expert
Financial Management: Lamar baily purchased a 7 percent coupon corporate bond
Reference No:- TGS01180437

Now Priced at $15 (50% Discount)

Recommended (95%)

Rated (4.7/5)