Suppose that you buy a 1-year maturity bond for $1,000 that will pay you $1,000 plus a coupon payment of $71 at the end of the year.

a. What real rate of return will you earn if the inflation rate is 2.95 percent? (Round your answer to 2 decimal places. Use minus sign to enter negative real rate of return, if any.)

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b. What real rate of return will you earn if the inflation rate is 3.5 percent? (Round your answer to 2 decimal places. Use minus sign to enter negative real rate of return, if any.)

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c. What real rate of return will you earn if the inflation rate is 4.9 percent? (Round your answer to 2 decimal places. Use minus sign to enter negative real rate of return, if any.)

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d. What real rate of return will you earn if the inflation rate is 6.9 percent? (Round your answer to 2 decimal places. Use minus sign to enter negative real rate of return, if any.)

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