What was your total real rate of return on this investment

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Reference no: EM13267538

Suppose you bought a 10 percent coupon bond one year ago for $950. The face value of the bond is $1,000. The bond sells for $985 today. If the inflation rate last year was 9 percent, what was your total real rate of return on this investment?

Answer

a.
-5.32 percent

b.
-4.88 percent

c.
10.47 percent

d.
9.78 percent

e.
4.78 percent

Reference no: EM13267538

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