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An Investor Bought a Bond at Par and Held It

Question 9

Multiple Choice

An investor bought a bond at par and held it for one year.If the coupon rate is 5 percent,residual maturity of the bond is 8 years,and the yield to maturity of the bond when it was sold was 6 percent,what is the holding period return of the bond?


A) 5%
B) 6%
C) -1.21%
D) -1.23%

Correct Answer:

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