Consider a bond with a term of one year, a principal or face value of $2,000 and
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Question:
Consider a bond with a term of one year, a principal or face value of $2,000 and that pays an end-year coupon of $50.
What will be the gross rate of return on the bond if the market interest rate falls to 1%?
A. 1.03
B. 1.02
C. 1.015
D. 1.01
E. 1.00
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