Initial Interest Yield (YTM = i ) Initial Price (Pt) at i = 4.3% Price Next Year (Pt+1) at i = 7.1% Rate of Inflation (ππ%) Real Rate of Return (RRET%) (2 marks each): Part 1: Calculate the purchase price (Pt) for the 25-year bond: Part 2: Calculate the purchase price (Pt) for the 15-year bond: Part 3: Calculate the purchase price (Pt) for the 2-year bond: Part 4: Calculate the sale price (Pt+1) for the 20-year bond: Part 5: Calculate the sale price (Pt+1) for the 10-year bond: Part 6: Calculate the sale price (Pt+1) for the 5-year bond: Part 7: Calculate the capital gain (g) on the 25-year bond: Part 8: Calculate the capital gain (g) on the 15-year bond: Part 9: Calculate the capital gain (g) on the 10-year bond: Part 10: Calculate the capital gain (g) on the 2-year bond: Part 11: Calculate the real rate of return (RRET) on the 25-year bond: Part 12: Calculate the real rate of return (RRET) on the 15-year bond: Part 13: Calculate the real rate of return (RRET) on the 10-year bond: Part 14: Calculate the real rate of return (RRET) on the 1-year bond:
