You bought one of Rocky Mountain Manufacturing Company's 9 percent coupon bonds one year ago for $1,047.30. These bonds make annual payments and mature seven years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 8.5 percent. If the inflation rate was 3.9 percent over the past year, what would be your total real return on the investment? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Total real return %

You bought one of Rocky Mountain Manufacturing Company's 9 percent coupon bonds one year ago for $1,047.30. These bonds make annual payments and mature seven years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 8.5 percent. If the inflation rate was 3.9 percent over the past year, what would be your total real return on the investment? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Total real return %

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter6: Fixed-income Securities: Characteristics And Valuation

Section: Chapter Questions

Problem 13P

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