If you buy a corporate bond for $9700 and sell it six months later for $10500 ,you will have

Question

Quizplus · Accepted Answer

The difference between the buy and sell price of the bond is a capital gain of $800, as the bond was sold for a higher price than it was purchased for. Interest income would come from receiving periodic interest payments from the bond issuer, but the question does not mention any such payments being made. The gain is taxable, but whether or not it is non-taxable would depend on various factors such as the investor's tax bracket and holding period.

If You Buy a Corporate Bond for $9700 and Sell