You purchased a zero coupon bond one year ago for $296.50.The market interest rate is now 6.5 percent.If the bond had 15 years to maturity when you originally purchased it, what is your total return to date if the face value of the bond is $1,000?

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The bond was purchased for $296.50 and has a face value of $1,000. The bond was held for one year, so it now has 14 years to maturity. The total return is calculated as [(Face Value / Purchase Price)^(1/Years Held) - 1]. The calculation is [(1000 / 296.50)^(1/14) - 1] = 0.3774 or 37.74%.

You Purchased a Zero Coupon Bond One Year Ago for $296.50.The