Question
A bond has 10 years until maturity, a coupon rate of 7.6%, and sells for $1,140. Interest is paid annually. (Assume a face value of
A bond has 10 years until maturity, a coupon rate of 7.6%, and sells for $1,140. Interest is paid annually. (Assume a face value of $1,000.)
A. If the bond has a yield to maturity of 10.4% 1 year from now, what will its price be at that time?
B. What will be the rate of return on the bond?
C. If the inflation rate during the year is 3%, what is the real rate of return on the bond?
*please solve using excel
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Understanding financial statements
Authors: Lyn M. Fraser, Aileen Ormiston
9th Edition
136086241, 978-0136086246
