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Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity)
Refer to Table 10-1, which is based on bonds paying 10 percent interest for 20 years. Assume interest rates in the market (yield to maturity) decline from 10 percent to 6 percent. a. What is the bond price at 10 percent? b. What is the bond price at 6 percent? c. What would be your percentage return on investment if you bought when rates were 10 percent and sold when rates were 6 percent? Note: Do not round Intermedlate calculations. Input your answer as a percent rounded to 2 decimal places
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