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Business, 24.09.2020 05:01 savthespice

Suppose that you invest in a 10-year 8% Treasury Note sold at par and the interest rate drops to 6% after your purchase. What will be the Total Dollar Return and the Realized Yield if you hold the bond ? (a) for 3 years;
(b) for 7 years;
(c) to maturity.
In each case, decompose the Total Dollar Return into
(1) Total Coupon Interest;
(2) Interest on Interest;
(3) Capital Gain / Loss.

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Suppose that you invest in a 10-year 8% Treasury Note sold at par and the interest rate drops to 6%...
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