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Consider a corporate bond that was purchased last year with a face value of $1,000, 8% annual coupon rate and a 15-year maturity. At the
Consider a corporate bond that was purchased last year with a face value of $1,000, 8% annual coupon rate and a 15-year maturity. At the time of purchase, the bond had an expected yield to maturity of 9%. Calculate the rate of return that would have been earned for the past year if the bond was sold today for $924.23. If your friend sold the bond today for $924.23, what is the dollar return she would have earned this past year? If your friend sold the bond today for $924.23, what is the rate of return she would have earned this past year?
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