Adrienne Dawson is planning to buy 10-year zero coupon bonds issued by the U.S.

$1.49 Excluding Tax

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QUESTION:

Adrienne Dawson is planning to buy 10-year zero-coupon bonds issued by the U.S. Treasury. If these bonds have a face value of $1,000 and are currently selling at $404.59, what is the expected return on them? Assume that interest compounds semiannually on similar coupon-paying bonds?


 

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