Question: A bond with a face value of $ 1 , 0 0 0 , coupon rate of 5 % and 1 year to maturity is

A bond with a face value of $1,000, coupon rate of 5% and 1 year to maturity is priced today at its face value. Suppose that expected inflation is 2%. What is the annual real return of the bond?
A.2.9% B.7.1% C.-2.1% D.5.7%

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