If a person bought one $100.00 30 year bond per month for ten years,
one 20 year bond per month for the next ten years, one 10 year bond
for the next ten years and the yield is 4.5% and the interest was
automatically reinvested, how much would they have at the end of 30
years?

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Request for Question Clarification by pafalafa-ga on 25 Oct 2006 11:54 PDT

At the end of 30 years, only the first bond would have matured.  

Can you give us any guidance as to how we should handle the remaining bonds?

pafalafa-ga

Actually, three bonds would have matured.  The first 30 year bond that
was issued, the first 20 year bond that was issued, and the first 10
year bond that was issued.  But maybe that's what you meant.

Also, I assume that the 20 and 10 year bonds are also $100.00 bonds. 
The question doesn't specify.

Is the automatically reinvested interest included in the calculation
that the yield is 4.5%?

Can we arbitrarily value the outstanding bonds at par  - $100 each?

Are we talking about zero coupon bonds?  If so, there is nothing to
reinvest in the 30 time period.  The first three bonds mature just as
the 30 year time horizon ends.  If there are monthly coupons you need
to tell us.  Also, if there are coupons, how should the money be
reinvested?  Bonds are sold in $100 increments.

I would think that bonds that have not matured would need to be valued
on the remaining time until maturity.  Since this depends in part on
the prevailing rate of interest, may we assume that the prevailing
rate of interest is 4.5% for the entire 30 year period?

The questioner is probably waiting for email notification ...