Calculating Investment Returns You bought one of Great White Shark Repellant Co.s 7 percent coupon bonds one

Question:

Calculating Investment Returns You bought one of Great White Shark Repellant Co.’s 7 percent coupon bonds one year ago for $920. These bonds make annual payments and mature six years from now. Suppose you decide to self your bonds today, when the required return on the bonds is 8 percent. If the inflation rate was 4.2 percent over the past year, what was your total real return on investment?

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...