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Emily has just bought a 6.5% coupon bond with a face value of $1,000 that matures in seven years and whose bond yield was quoted
Emily has just bought a 6.5% coupon bond with a face value of $1,000 that matures in seven years and whose bond yield was quoted at 6% at the time of the purchase. The coupon is paid annually. Emily plans on holding the bond for four years. If she wants to earn a 7% rate of return on this investment, what yield should the bond have at the end of her holding period?
The correct answer is 4.37%. Can you show me how to get to the correct answer while using a financial calculator?
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