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Suppose you purchased a 2 0 - year U . S . treasury bond with a 6 % annual coupon ten years ago at par,
Suppose you purchased a year US treasury bond with a annual coupon ten years ago at par,
but coupon payments are made semiannually.
Today the bond's yield to maturity has risen to
a If you hold the bond until maturity, what is the yield that you will earn on your investment?
b If you sell the bond now, what will be the price at which you sell the bond?
c If you sell the bond now, what annual return yield that you have made on this bond?
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