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Consider a newly issued $10,000 inflation protected bond paying an annual real interest rate of 5%. If inflation runs 1% in year 1 and then
Consider a newly issued $10,000 inflation protected bond paying an annual real interest rate of 5%. If inflation runs 1% in year 1 and then 4% in year 2, what is the amount of the interest payment in year 2? (Giver you answer to two decimal places, and be careful to be precise in all computations)
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