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A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.7%, and sells for $1,130. Interest

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A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.7%, and sells for $1,130. Interest is paid annually. (Assume a face value of $1,000 and annual coupon payments.) a. If the bond has a yield to maturity of 10.3% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your answer to nearest whole number.) Price $ 853 b. What will be the rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.) Rate of return %

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