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You buy a 1 0 - year 4 % annual bond for 1 1 0 , hold it for one year, receive the coupon cash
You buy a year annual bond for hold it for one year, receive the coupon cash flow, and sell it for
The realized yield on your investment to two decimal places is
Hint. What did you pay for the bond? What is your profit from the bond coupon plus capital gain Divide profit by what you paid.
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