Question

Kayla is considering investing in a bond with a face value of $12,000 with a coupon rate of 12% payable on a monthly basis. If she can get a 2.5% return per quarter on her money, what are the monthly payments that she can receive from the bond

Answer 1

The answer is "$ 120"

Step-by-step explanation:

Given value:

`\text{Monthly payment= Face value} * \frac{\text{Coupon rate}}{12}`

`= \$ 12,000 * (12 \%)/(12)\\\\= \$ 12,000 * (0.12)/(12)\\\\= \$ 1,000 * 0.12\\\\= \$ 120`