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Consider an investor initially purchases a 1 0 - year, 8 % annual coupon payment bond at a price of $ 8 5 . 5

Consider an investor initially purchases a 10-year, 8% annual coupon payment bond at a price of $85.503075 per $100 of par value. The bond's yield to maturity (YTM) is 10.40%.
4. Assume the investor holds this bond until maturity. Also assume that the interest rates go down to 9.40%(100 basis points decrease) after the bond is purchased and before the first coupon is received. What is the investor's realized rate of return?
5. Assume the investor sells this bond after four years. Also assume that the interest rates go down to 9.40%(100 basis points decrease) after the bond is purchased and before the first coupon is received. What is the investor's realized rate of return?
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