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Suppose you bought a 8 percent coupon bond one year ago for $1,170. The bond sells for $1,230 today. Requirement 1: Assuming a $1,000 face
Suppose you bought a 8 percent coupon bond one year ago for $1,170. The bond sells for $1,230 today.
Requirement 1: | |
Assuming a $1,000 face value, what was your total dollar return on this investment over the past year? | |
Requirement 2: | |
What was your total nominal rate of return on this investment over the past year? | |
Requirement 3: | |
If the inflation rate last year was 5 percent, what was your total real rate of return on this investment? (Do not round intermediate calculations.) | |
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