You buy a bond with a $1,000 par today for a price of $875.The bond has 6 years to maturity and makes annual coupon payments of $75 per year.You hold the bond to maturity but you do not reinvest any of your coupons.What was your effective EAR over the holding period?
A) 10.40%
B) 9.57%
C) 7.45%
D) 8.78%
Correct Answer:
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