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What will be your rate of return

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Question - BCE bond has 10 years until maturity and a coupon rate of 8% payable annually, and sells for $1,100.

a. If the BCE bond in problem 6 has a yield to maturity of 8% 1 year from now, what will its price be?

b. What will be your rate of return if you buy it today and sell it in one year?

c. If the inflation rate during the year is 3%, what is the real rate of return on the bond?

Reference no: EM132835058

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