Question: just b. and c. please Problem 6-17 Bond Returns (LO2, 3) A bond with a foce value of $1,000 has 10 years until maturity, carries
Problem 6-17 Bond Returns (LO2, 3) A bond with a foce value of $1,000 has 10 years until maturity, carries a coupon rate of 70%, and sells for $1.200. Interest is paid annually. (Assume a face value of $1,000 and annual coupon payments.) a. If the bond has a yield to maturity of 11.0% 1 year from now, what will its price be at that time? (Do not round Intermediate calculations, Round your answer to nearest whole number.) Price $ 779 b. What will be the rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.) Rate of return c. If the inflation rate during the year is 3%, what is the real rate of return on the bond? (Assume annual interest payments.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.) Real rate of retum
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