Five years remaining to maturity at the time of purchase

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You purchased an annual interest coupon bond one year ago with five years remaining to maturity at the time of purchase. The coupon interest rate is 10% and par value is $1,000. At the time you purchased the bond, the yield to maturity was 8%. If you sold the bond after receiving the first interest payment and the bond's yield to maturity had changed to 7%, how much would have been your annual total rate of return on holding the bond for that year?

Reference no: EM131938875

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