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Suppose an investor buys a 13-year bond with annual coupon of 8% and face value of $1.000 for $1.200,00 today. If in four years the
Suppose an investor buys a 13-year bond with annual coupon of 8% and face value of $1.000 for $1.200,00 today. If in four years the interest rate increases 1% (ex: increase from 7,36% to 8,36%), what will be the annual compounded return (IRR) if the investor sells the bond just after receiving the fourth coupon payment?
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