An investor purchases a nine-year, 7% annual coupon bond at a price equal to face value. After the bond is purchased and before the first coupon is received, interest rates increase to 8%. The investor sells the bond after five years. Assume that interest rates remain unchanged at 8% over the five-year holding period. Assuming that all coupons are reinvested over the holding period at 8%, the investors five year horizon annual rate of return is closest to:

6.62%

5.91%

7.12%

7.79%