Question

Sunni bought a $500 corporate bond. The bond pays 4.8% interest per year. If Sunni holds the bond for 15 years, how much will Sunni receive in interest?

A. $24
B. $140
C. $360
D. $480

Answer 1

C, I believe.

You multiply 4.8% by the 15 year bond to get 72%. Then, you turn 72% into a decimal by bringing the decimal behind the number up by two and get 0.72. After that, you multiply 0.72 by $500 and get $360.

Answer 2

Sunni will receive $360 ( C ) in interest of the 15 years period of holding the $500 corporate bond.

Step-by-step explanation:

annual interest rate = 4.8%

worth of bond = $500

Interest in 15 years = 4.8% * 15

0.048 * 15 = 0.72 = 72%

how much interest is received in a year = 0.048 * $500

= $24

how much interest received in 15 years = $24 * 15

= $360