Question: Question: An AT&T bond has 10 years until maturity, a coupon rate of 8 percent, and sells for $1,050. a. What is the current yield

Question: An AT&T bond has 10 years until maturity, a coupon rate of 8 percent, and sells for $1,050.

a. What is the current yield on the bond?

b. What is the yield to maturity?

Question.If the AT&T bond in above Question has a yield to maturity of 8 percent 1 year from now,

What will its price be?

b. What will be the rate of return on the bond?

c. If the inflation rate during the year is 3 percent, what is the real rate of return on the bond?

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