If you expect inflation to be 2year over the life of the


Question: Collingwood Homes has a bond issue outstanding. These bonds have an 8.0% coupon that is paid semiannually. The bonds mature in 22 years. The bonds have a par value of $1,000 and a market price of $1,087.00.

What is the Yield to Maturity of this bond?

What is the Current Yield of this Bond?

What is the Capital Gain Yield of this Bond?

If you expect inflation to be 2%/year over the life of the bond, what is the expected Exact Real Rate of Return on this investment?

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Finance Basics: If you expect inflation to be 2year over the life of the
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