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Suppose that a 6% annual pay Government of Canada bond that matures in 2 years has a yield to maturity of 6.75%. If inflation is
- Suppose that a 6% annual pay Government of Canada bond that matures in 2 years has a yield to maturity of 6.75%. If inflation is expected to be 2% per year over the next 2 years, what coupon rate would you expect to fund on a Real Return bond that is otherwise identical
- 4%
- 4.15%
- 3.75%
- 4.25%
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International Finance Theory and Policy
Authors: Paul R. Krugman, Maurice Obstfeld, Marc J. Melitz
10th edition
978-0133425895, 133425894, 978-0133423631, 133423638, 978-0133423648
