Question: Problem 12-4 Calculating Returns (LO1) Suppose you bought a 7.1% coupon bond one year ago for $980. The bond sells for $950 today. a. Assuming
Problem 12-4 Calculating Returns (LO1) Suppose you bought a 7.1% coupon bond one year ago for $980. The bond sells for $950 today. a. Assuming a $1,000 face value, what was your total dollar return on this investment over the past year? (Omit $ sign in your response.) Total dollar return $ 41 b. What was your total nominal rate of return on this investment over the past year? (Round your answer to 2 decimal places.) Nominal rate of return 4.18% c. If the inflation rate last year was 3%, what was your total real rate of return on this investment? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Use the Fischer formula in your calculations.) Real rate of return .01 %
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