Problemyou buy a bond with a 1000 par value today for a, Ask an Expert

Accounting

Problem:

You buy a bond with a $1,000 par value today for a price of $865. The bond has 6 years to maturity and makes annual coupon payments of $73 per year. You hold the bond to maturity, but you do not reinvest any of your coupons.

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Question: What was your effective EAR over the holding period?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91169653

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