Calculate the approximate real rate of return

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a) A bond issued by ENBRIDGE INC on September 2, 1999 was purchased on March 8, 2022 at the 103 index. This bond has a coupon rate of 5.75% per annum compounded semi-annually, with coupons due on September 2 and March 2. The maturity date is September 2, 2039 and the redemption value is at par. Calculate the current yield, the yield to maturity and the effective annual yield of the bond? Please present all your calculations

b) For this same bond in (a), if the current inflation rate is 4.5%, calculate the approximate real rate of return then the exact real rate? Please present all your calculations

Reference no: EM133121736

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