What was your total real rate of return on this investment

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Reference no: EM131861915

Suppose you bought a bond with a coupon rate of 7.4 percent one year ago for $900. The bond sells for $940 today.

a. Assuming a $1,000 face value, what was your total dollar return on this investment over the past year? (Do not round intermediate calculations.)

Total dollar return $

b. What was your total nominal rate of return on this investment over the past year? (Do not round intermediate calculations. Enter your answer as a percent rounded 2 decimal places (e.g., 32.16).)

Nominal rate of return %

c. If the inflation rate last year was 2 percent, what was your total real rate of return on this investment? (Do not round intermediate calculations. Enter your answer as a percent rounded 2 decimal places (e.g., 32.16).)

Real rate of return

Reference no: EM131861915

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