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8. The 10 year IBM corporate bond you purchased is contracted to pay a semi-annual 6.75% coupon. If you purchase this bond for $1,089.64 it
8. The 10 year IBM corporate bond you purchased is contracted to pay a semi-annual 6.75% coupon. If you purchase this bond for $1,089.64 it will have a yield to maturity of 5.569%. What is the expected capital gain or loss for the first year holding period?
(a) a capital loss of 0.62% (b) a capital loss of 1.18% (c) a capital loss of 3.40% (d) a capital gain of 1.18% (e) a capital gain of 0.62%
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