Ask Experts Questions for FREE Help !
Ask
    Pawani's Avatar
    Pawani Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Jun 2, 2009, 02:36 AM
    Calculate Rate of return
    A bond is available for Rs 1400. It offer include one immediate payment nad 10 annual payments of Rs 210 each. Compute the rate of return?
    ArcSine's Avatar
    ArcSine Posts: 969, Reputation: 106
    Senior Member
    		  
    #2

    Jun 6, 2009, 08:19 AM
    Pawani, check my understanding of your question: The purchase price of this instrument is Rs 1,400. It will return 11 cash flows to the holder, each one of Rs 210. The first of the eleven occurs immediately, and the other 10 are annually, with the first of those being one year out.

    If that's the case, the instrument's yield is 9.4377% (rounded a bit, natch).

    Hope this helps!

    ...it was early and I was full of no coffee...
    lk_klare's Avatar
    lk_klare Posts: 1, Reputation: 1
    New Member
    		  
    #3

    Dec 18, 2010, 08:17 AM
    How you have calculated 9.4377%
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

How to calculate Accounting rate of return [ 3 Answers ]

I need to calculate Accounting rate of return I know that it is Average Profit/Average investment If project 1 Cost is 1,000,000 And cash flows are Year 0 0 Year 1 150,000 Year 2 200,000 3 300,000...

How to calculate Internal rate of Return [ 1 Answers ]

The Ozone Friendly Company has identified the following project. Year project 0 (Investment) - R12 500 1 R1 000 2 R6 000 3 R5 000 4 R4 000

Calculate rate on asset return [ 2 Answers ]

Does anyone know the formula for calculating rate of asset return on both an accrual basis and a cash flow basis?

View more questions Search