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NEW QUESTION: 1
A. Option A
B. Option C
C. Option D
D. Option B
Answer: B,D
NEW QUESTION: 2
An investor buys a 15-year, 10 percent annual pay coupon bond for $1,000. He plans to hold the bond for
5 years while reinvesting the coupons at 12 percent. At the end of the 5-year period he feels he can sell the bond to yield 9 percent. What is the expected realized (horizon) yield?
A. 11.8%.
B. 10.0%.
C. 12.2%.
D. 11.2%.
Answer: D
Explanation:
Explanation/Reference:
Explanation:
The key to this problem is to find all future cash flows. N = 5, I/Y = 12, PMT = 100, PV = 0CPT FV = 635.28
= VALUE OF COUPONSN = 10, I/Y = 9, PMT = 100, FV= 1000CPT PV = 1,064.18 = VALUE OF BOND 5 YEARS OUT Realized Return
Question-LI-SS14-LOS1-
A-a-answer-1
Question-LI-SS14-LOS1-A-a-answer-2
NEW QUESTION: 3
A. #
B. !
C. %
D. &
E. +
Answer: D
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