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Consider the following bond for questions 5 8 : Exactly 1 0 years to maturity 7 . 5 % yield to maturity 5 % coupon,

Consider the following bond for questions 58:
Exactly 10 years to maturity
7.5% yield to maturity
5% coupon, paid semi-annually
$100 par value
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Now suppose that, in exactly 7 years, the yield on bonds of the same risk decreases to 5% and you sell the bond at that time (e.g., in exactly 7 years). What is your annualized rate of return in this scenario? Assume that coupons are reinvested at the prevailing yield.

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