Question

Ivan bought a $1000 bond with a 4.5% coupon that matures in 30 years. What are Ivan's total earnings for this bond when it reaches its maturity date?

Answer 1

Ivan's earnings is $1350,00

Step-by-step explanation:

By the context, we can infer it is the simple interest rate regime, for this bond, with a 4.5% coupon rate that matures in 30 years.

P=1,000

A=P*n*i

coupon rate=i= 4.5% =0.045= per year

n=30 yrs

A=1,000*0.045*30

A=1,350

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Answer 2

To find out ivan's total earning, first we must found out his annual interest earning , which would be :
$1,000 x 4.5 % = $45 per year

His total earning for 30 years = 45 x 30 = $1,350

since there is no information about values changes, that will be pretty much it,

hope this helps