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An investor buys a bond with the following characteristics: Maturity - 10 years Coupon - 4.5%,...

An investor buys a bond with the following characteristics: Maturity - 10 years Coupon - 4.5%, paid once per year Nominal Value - £100 The yield to maturity at the time of purchase is 8.50%. The investor sells the bond immediately after the sixth coupon payment, when the yield to maturity rises to 9.50%. a.What is the investor’s realised annual rate of return after the sale of the bond, assuming that the investor can reinvest received coupons at the yield to maturity?

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