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An investor pays $900 for a long-term bond that carries a 9 percent coupon. After a year, she hopes to sell the issue for $950.

An investor pays $900 for a long-term bond that carries a 9 percent coupon. After a year, she hopes to sell the issue for $950. If her expectations come true, what is her return for this investment? What is her holding period return if she were able to sell the bond (at $950) after only six months? What is her holding period return if she were able to sell the bond in three years?

A.

14.4%, 12.62%,12.24%:

B.

12.2%, 14.42%,12.65%

C.

15.6%, 11.11%.11.85%

D.

11.85%, 12.45%, 13.33%

E.

13.33%, 15.20%, 11.3%

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