Problem 10-23 Calculating Investment Returns [LO 1] You bought one of Rocky

Problem 10-23 Calculating Investment Returns [LO 1]

You bought one of Rocky Mountain Manufacturing Co.%u2019s 8.75 percent coupon bonds one year ago for $1051.80. These bonds make annual
payments and mature eight years from now. Assume that you decide to sell your bonds today when the required return on the bonds is 8.25
percent.

If the inflation rate was 3.8 percent over the past year what would be your total real return on investment? (Do not include the percent sign (%). Enter rounded answer as directed but do not use the rounded numbers in intermediate
calculations. Round your answer to 2 decimal places (e.g. 32.16).)