What is one-year holding period return

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Problem 1: You buy a 10-year bond with a 4% coupon rate (paid annually) and a $1,000 face value at par. If the yield to maturity increases to 5% per year compounded annually one year from now, what is your 1-year holding period return?

A) -3.1%
B) 3.1%
C) 11.1%
D) -7.1%
E) Not enough information to calculate

Reference no: EM132806474

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