Assume that you purchased a $1000 par value bond for $960. The bond pays 10% coupon annually. You sold the bond a year later for $1,040, right after you received the bond's annual interest payment. The bond was yielding 11.0% at the time of purchase and 9.5% at the time of sale. Calculate your annual realized rate of return on this investment. (a) 4.0%
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