Calculating rates of return lo3 refer back to the series ee, Ask an Expert

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Calculating Rates of Return. [LO3] Refer back to the Series EE savings bonds we discussed at the very beginning of the chapter.

Assuming you purchased a $50 face value bond, what is the exact rate of return you would earn if you held the bond for 20 years until it doubled in value?

If you purchased a $50 face value bond in early 2014 at the then current interest rate of .10 percent per year, how much would the bond be worth in 2024?

In 2024, instead of cashing the bond in for its then current value, you decide to hold the bond until it doubles in face value in 2034. What rate of return will you earn over the last 10 years?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92057415

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