You purchase a 30-year, zero-coupon bond for a price of $15. The bond will pay back $100 after 30 years and make no interim payments. The annual compounded return (geometric average return) on this investment is OA 6.2% OB. 7.83 % OC. 5.55 % OD. 6.53 %

You purchase a 30-year, zero-coupon bond for a price of $15. The bond will pay back $100 after 30 years and make no interim payments. The annual compounded return (geometric average return) on this investment is OA 6.2% OB. 7.83 % OC. 5.55 % OD. 6.53 %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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You purchase a 30-year, zero-coupon bond for a price of $15. The bond will pay back $100 after 30 years and make no interim payments. The annual compounded
return (geometric average return) on this investment is:
OA. 6.2%
OB. 7.83 %
C. 5.55 %
D. 6.53 %

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