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8. One year ago, an investor purchased a 10-year, $1,000 par value, 8% semiannual coupon bond with an 8% yield to maturity. Now, one year

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8. One year ago, an investor purchased a 10-year, $1,000 par value, 8% semiannual coupon bond with an 8% yield to maturity. Now, one year later, interest rates remain unchanged at 8%. If the investor sells the bond today (immediately after receiving the second coupon payment, and with no transaction costs), he will have:* O A. a capital gain of $80. O B. a capital loss of $80. O C. no capital gain or loss. O D. cannot be determined. O E. None of the above. 9. Kelly Inc's 5-year bonds yield 7.50% and 5-year T-bonds yield 4.90%. The real riskfree rate is r* = 2.5%, the default risk premium for Kelly's bonds is DRP - 0.40%, the liquidity premium on Kelly's bonds is LP = 2.2% versus zero on T- bonds, and the inflation premium (IP) is 1.5%. What is the maturity risk premium (MRP) on all 5-year bonds?" O A. 0.73% O B.0.81% O C. 0.90% D. 0.99% O E. None of the above

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