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Ten years ago, Ginger Incorporated sold a 25 year bond issue with a 12% annual coupon rate and a 7% call premium. Today, Ginger, Inc.

Ten years ago, Ginger Incorporated sold a 25 year bond issue with a 12% annual coupon rate and a 7% call premium. Today, Ginger, Inc. called the bonds. The bonds originally were sold at their face value of $1,000. Compute the realized rate of return for investors who purchased the bonds when they were issued and who surrendered them today in exchange for the call price.

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