If the inflation rate was 32 percent over the past year, Financial Management

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If the inflation rate was 32 percent over the past year

You bought one of Great White Shark Repellant CO’s 7 percent coupon bonds one year ago for $1,045.

These bonds make annual payments and mature 12 years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 6 percent.

If the inflation rate was 3.2 percent over the past year, what was your total real return on investment?

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Financial Management: If the inflation rate was 32 percent over the past year

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Financial Management: If the inflation rate was 32 percent over the past year

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