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MRDL Co . ' s bonds, issued 8 years ago, currently sell for $ 1 , 1 2 3 . They have a 9 .
MRDL Cos bonds, issued years ago, currently sell for $ They have a semiannual coupon rate and a year maturity, a $ par value, and are callable in years from the issue date at $ Assume that no costs other than the call pretmium would be incurred to call and refund the bonds, and also assume that the yield curve is horizontal, with rates expected to remain at current levels in the future. Under these conditions, what rate of return should an investor expect to earn if he or she purchases these bonds, years after the issue?
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