63. You purchase a $1,000 face-value bond for $800. The coupon is $100 per year, and inflation is 4 percent per year. What is the real coupon rate on the bond? (A) 6 percent. (В) 8.5 реrcent. (C) 10 percent. (D) 12.5 рercent.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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63. You purchase a $1,000 face-value bond for $800. The coupon is $100 per year, and
inflation is 4 percent per year. What is the real coupon rate on the bond?
(A) 6 percent.
(B) 8.5 percent.
(C) 10 percent.
(D) 12.5 рercent.
Transcribed Image Text:63. You purchase a $1,000 face-value bond for $800. The coupon is $100 per year, and inflation is 4 percent per year. What is the real coupon rate on the bond? (A) 6 percent. (B) 8.5 percent. (C) 10 percent. (D) 12.5 рercent.
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