The one-year return on a 10-year coupon bond with face value of $10,000 and a...
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Accounting
The one-year return on a 10-year coupon bond with face value of $10,000 and a 4% coupon rate that initially sells for par is
a.) All the Above
b) -3% if interest rates immediately rise from 4% to 5% after the bond is sold
c) 12% if interest rates immediately fall from 4% to 3% after the bond is sold
d) 4% if interest rates do not change
e) None of the above
I know the answer is all the above, but I am having trouble solving for the percent change in the return in the change of interest rates.
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