A bond is sold at a face value of $200

Question

with an annual yield of 3%
. How much will the bondholder have received in payment from the bond issuer after the bond has reached its maturity date of one year?(1 point)
Responses

$206
206 dollars

$406
406 dollars

$6
6 dollars

$200

Answer 1

To calculate how much the bondholder will receive after one year, you need to consider both the face value of the bond and the interest earned over that year.

The face value of the bond is $200, and the annual yield (interest) is 3%.

To find the interest earned in one year: Interest = Face Value × Yield Interest = $200 × 0.03 = $6

At maturity, the bondholder will receive the face value plus the interest earned: Total Payment = Face Value + Interest Total Payment = $200 + $6 = $206

So, the bondholder will have received $206.