Return on investment

1586 views 1 replies
  1. You bought one of Rocky Mountain Manufacturing Co.’s 8 percent coupon bonds one year ago for $1,028.50.  These bonds make annual payments and mature nine years from now.  Suppose you decide to sell your bonds today, when the required return on the bonds is 7 percent.  If the inflation rate was 4.8 percent over the past year, what would be your total real return on investment?
Replies (1)
the total return on the investment would still be 7 % . However the real rate of return would be 2.2 %...


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register