Suppose you purchase a 10-year bond with 6.8% annual coupons. You hold the bond for four years, and sell it immediately after receiving the fourth coupon. If the bond's yield to maturity was 4.8% when you purchased and sold the bond,

Part 1

a. What cash flows will you pay and receive from your investment in the bond per $100 face value?

The cash flows from the investment are shown in the following timeline:

b. What is the annual rate of return of your investment? The annual rate of return of your investment is __%. (Round to one decimal place.)

A. Year Cash Flows $115.59 B. Year Cash Flows $117.02 C. Year Cash Flows $110.22 D. Year Cash Flows $115.59