The expected return on previously-issued bonds is the coupon rate plus the expected percentage change in the ________ over the course of the year.

Question

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The expected return on previously-issued bonds is calculated as the coupon rate (the interest payment the bond will make) plus the expected percentage change in the bond's price over the course of the year. Changes in the bond's price can affect the total return an investor receives from holding the bond.

The Expected Return on Previously-Issued Bonds Is the Coupon Rate