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Suppose you buy a bond with a coupon of 7.6 percent today for $1,000. The bond...

Suppose you buy a bond with a coupon of 7.6 percent today for $1,000. The bond has 15 years to maturity. Two years from now, the YTM on your bond has increased by 2 percent, and you decide to sell. What is the percentage realized rate of return? Assume that interest payments are reinvested at the original YTM.  The bond pays coupons twice a year.

(Do not round intermediate calculations. Round your answer to 2 decimal places.)

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Expert Solution

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

jeff jeffy answered 2 years ago
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