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Suppose you bought a bond with an annual coupon rate of 7 . 5 % 1 year ago for $ 8 9 8 . The
Suppose you bought a bond with an annual coupon rate of
year ago for $ The bond sells for $ tody
aAssuming a $ face value, what was your total
dollar return on this investment over the past year?
b What was your total nominal rate of return on
this investment over past year?
c If the inflation rate last year was what
was your total real rate of return on this investment?
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