What would be your one-period return on investment

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Reference no: EM131991287

At the beginning of the year, you bought a $1,000 par value bond with a 6% coupon, payable annually, and a 10-year maturity. When you bought the bond, it had a expected yield to maturity of 8% per annum, compounded annually. Today the bond sells for $1,060. (a) What price did you pay for the bond? (b) If you sell the bond today (in addition to receiving the coupon), what would be your one-period return on the investment? Show how to answer step by step manually and with excel given the formulas.

Reference no: EM131991287

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