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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
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Please offer me some ideas on article below, paying particular attention to the methodology described, if there's any gap and also the main findings that may occur. Thank you.
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