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A $ 2 , 5 0 0 bond had a coupon rate of 6 . 5 0 % with interest paid semi - annually. Cody

A $2,500 bond had a coupon rate of 6.50% with interest paid semi-annually. Cody purchased this bond when there were 7 years left to maturity and when the market interest rate was 7.50% compounded semi-annually. He held the bond for 2 years, then sold it when the market interest rate was 3.50% compounded semi-annually.
Calculate his gain or loss on this investment.
a.
-$133.12
b.
$475.55
c.
$38.78
d.
$608.66

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