If you buy a corporate bond for $5,000 with an interest rate of 10% and hold it to its maturity date in 10 years,what interest payment amount will you receive every 6 months and what is the total amount of interest paid?

Question

Quizplus · Accepted Answer

The bond pays 10% of $5,000 annually, which is $500. Since interest is paid every 6 months, each payment is half of the annual interest, or $250. Over 10 years (20 payments), the total interest paid is $5,000.

If You Buy a Corporate Bond for $5,000 with an Interest