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What is the expected total dollar return

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Reference no: EM133111520

Prof, W. Sharpe has just purchased a bond that has the following features:

Par value = $1,000

Coupon rate = 8% (paid semi-annually)

TTM = 15 years

YTM = 6% and is assumed to remain constant throughout

If he expects to sell the bond after 5 years, what is the expected total dollar return at the end of year 5? What is his expected annual rate of return on this investment?

Reference no: EM133111520

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