An investor owned a 9% annual payment coupon bond for 6 years that was originally purchased at a 9% required return. She did not reinvest any coupons (she kept the money under her mattress). She redeemed the bond at par. What was her annual realized rate of return? What if she did reinvest the coupons but only earned 5% on each coupon? Why are your answers not equal to 9%?

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The Answer of An investor owned a 9% annual payment coupon bond for 6 years that was originally purchased at a 9% required return. She did not reinvest any coupons (she kept the money under her mattress). She redeemed the bond at par. What was her annual realized rate of return? What if she did reinvest the coupons but only earned 5% on each coupon? Why are your answers not equal to 9%?

An Investor Owned a 9% Annual Payment Coupon Bond for 6