5-77. A bond has a face value of $1,000, is redeemable in eight years, and pays interest...

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5-77. A bond has a face value of $1,000, is redeemable in eight years, and pays interest of $100 at the end of each of the eight years. If the bond can be purchased for $981, what is the rate of return if the bond is held until maturity? (5.3)

(a) 10.65%

(b) 12.65%

(c) 10.35%

(d) 11.65%

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