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Suppose that you buy a two-year 7

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Suppose that you buy a two-year 7.7% bond at its face value.

a-1) What will be your total nominal return over the two years if inflation is 2.7% in the first year and 4.7% in the second? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

a-2) What will be your total real return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

b) Now suppose that the bond is a TIPS. What will be your total 2-year real and nominal returns? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)