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Suppose that you buy a 1 - year maturity bond for $ 1 , 0 0 0 that will pay you $ 1 , 0

Suppose that you buy a 1-year maturity bond for $1,000 that will pay you $1,000
plus a coupon payment of $64 at the end of the year.
a. What real rate of return will you earn if the inflation rate is 2.4 percent? (Round
your answer to 2 decimal places. Use minus sign to enter negative real rate of
return, if any.)
Real rate of return
b. What real rate of return will you earn if the inflation rate is 3.6 percent? (Round
your answer to 2 decimal places. Use minus sign to enter negative real rate of
return, if any.)
Real rate of return
c. What real rate of return will you earn if the inflation rate is 5.6 percent? (Round
your answer to 2 decimal places. Use minus sign to enter negative real rate of
return, if any.)
d. What real rate of return will you earn if the inflation rate is 7.2 percent? (Round
your answer to 2 decimal places. Use minus sign to enter negative real rate of
return, if any.)
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