You buy a bond issued by terlingua oil amp gas exploration, Ask an Expert

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You buy a bond issued by Terlingua Oil & Gas Exploration Corp. The coupon rate is 8%, and coupons are paid semi-annually. Par of your bond is $10,000. The bond matures in 12 years. Your price today on the bond is $11,000.

In six months, the YTM on the bond has fallen by 1%. You collect the coupon payment and sell the bond. What is your effective annual rate of return?

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Financial Management, Finance

Category:- Financial Management
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