Question: having trouble solving for a-2 and b! Thank youuu Suppose that you buy a two-year 7.2% bond at its face value a-1. What will be
having trouble solving for a-2 and b! Thank youuu
Suppose that you buy a two-year 7.2% bond at its face value a-1. What will be your total nominal return over the two years if inflation is 2.2% in the first year and 4.2% in the second? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Nominal return a-2. What will be your real return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Real retum b. Now suppose that the bond is a TIPS. What will be your total 2-year real and nominal returns? (Do not round intermediate calculations. Enter your answers as a percent 14.92 % rounded to 2 decimal places.) Real returrn Nominal return
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