Assume that a year ago you invested 10000 in a bond fund, Ask an Expert

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Assume that a year ago, you invested $10,000 in a bond fund, purchasing 1,000 shares at$10.00 each. Assume also that the bond fund was advertising a yield of 10%, or $1.00 per share, which was maintained for the entire year. But suppose that in the meantime, interest rates have risen so that now bond funds with similar maturity and credit quality yield 11%. As a result, your bond fund is now selling for $9.00 per share. Ignoring interest-on-interest and commission costs, what is the total return on your bond fund investment for the past year? D. 0% C. 5% B. 11% A. 10%.

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Financial Management, Finance

Category:- Financial Management
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