If a US Saving bond can be purchased for $29.50 and has a maturity value at the end of 25 years of $100,what is the annual rate of return on the bond?
A) 5 percent
B) 6 percent
C) 7 percent
D) 8 percent
E) 4 percent

Question

Quizplus · Accepted Answer

i = 11ea7fdb_fc25_eb06_a768_e1a90ef649ce_TB2902_00 - 1
i = 11ea7fdb_fc25_eb07_a768_cdc5e43e1889_TB2902_00 - 1 = 5%
Using a financial calculator:
N = 25, PV = -29.50, PMT = 0, FV = 100, cpt I/Y = 5%

If a US Saving Bond Can Be Purchased for $29