Question

Gabriel buys a $2,000 fixed-rate bond with a 4% coupon and five years to maturity. How much interest will he earn over the life of the bond?

Answer 1

any idea ? how many is 4% of $2000 ? and what mean this ,,five years ? what you need to do with this 4% of $2000 result ?

hope helped

Answer 2

old question but will answer so this can be closed

a 4% coupon rate means he will earn 4% of the 2,000 bond per year over five years ---> calculate 4% of 2,000 and multiply by 5 years