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A 9.0% coupon semiannual bond has 10 years remaining until maturity. It is currently selling for $1124 for every $1000 of face value. Suppose you
A 9.0% coupon semiannual bond has 10 years remaining until maturity. It is currently selling for $1124 for every $1000 of face value. Suppose you purchase the bond in the problem above at the current price, and hold it for 3 years. At the end of the 3 years, the yield on the bond has risen by 50 basis points, and you decide to sell the bond. For your bond investment, find the realized rate of return.
A. 4.96%
B. 4.61%
C. 5.88%
D. 6.04%
E. 6.45%
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