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Consider a Government of Canada bond that has par value 1,000, annual coupon rate 5%, and 10 years to maturity. The bond is currently selling
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Consider a Government of Canada bond that has par value 1,000, annual coupon rate 5%, and 10 years to maturity. The bond is currently selling at 1,020.
(a) What is the rate of return you expect to earn if you purchase the bond and hold it to maturity, i.e., YTM? (b) If the expected rate of inflation is 2%, what is the real rate of return you expect to earn?
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The Wealthtech Book The FinTech Handbook For Investors Entrepreneurs And Finance Visionaries
Authors: Susanne Chishti, Thomas Puschmann
1st Edition
1119362156, 978-1119362159
