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Realized rate of return on the investment

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An investor purchases a corporate bond for $9,800 that had a coupon rate of 5 percent and a par value of $10,000 and three years left to maturity. After one year, the investor claims the coupon payment and then sells the bond in the marketplace to an investor demanding a 5 percent yield to maturity. What was the initial investors realized rate of return on the investment?

Reference no: EM132199117

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