Compute the realized rate of return for investors

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Challenging. Goodwin & Wulff LLC sold a 20-year bond issue 7 years ago. It had a 12% annual coupon rate, paid semiannually, and an 8% call premium (i.e., paid 8% premium to face value if called). Today, the company called the bonds. The bonds were originally sold at their face value of $1,000. Compute the realized rate of return for investors who bought the bonds at issue and had them called away today.

Reference no: EM132234860

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