Problem:
You bought one of Great White Shark Repellant Co.'s 9 percent coupon bonds one year ago for $770. These bonds make annual payments and mature 15 years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 11 percent.
Requirement:
Question: If the inflation rate was 3 percent over the past year, what was your total real return on investment?
- 20.27%
- 26.57%
- 7.95%
- 19.30%
- 19.40%
Note: Could someone please give me a step by step solution?