Question

An investment of $7,800 made March 31, 2001 pays $700 at the end of every six months for five years and pays $10,000 on March 31, 2006. What rate of interest was being earned every six months?
700/7800 = 0.09874 = 9.87%

You need to consult a "yield to maturity" formula. I get about 23% annual rate.

Related Questions

In the formula A=p(1+i)^n, I can not remember how to sub a value for "i" (interest) into the equat... Prepare all the necessary journal entries to record the following transactions: 1. Sale of a 20 yea... An investor has $50,000 to invest in two types of bonds. Bond A is a conservative investment that pa... 1. Unit 8: A $5000 investment is made in a savings account that pays 10%/a compounded quarterly. How...