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Suppose you bought a bond with an annual coupon rate of 5.6 percent one year ago for $800. The bond sells for $865 today. a.

Suppose you bought a bond with an annual coupon rate of 5.6 percent one year ago for $800. The bond sells for $865 today.

a.

Assuming a $1,000 face value, what was your total dollar return on this investment over the past year?

Total dollar return$

b.

What was your total nominal rate of return on this investment over the past year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Nominal rate of return %

c.

If the inflation rate last year was 2 percent, what was your total real rate of return on this investment? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Real rate of return

%

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