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Bond currently sells for $840 and has annual coupon rate of 6.35% and a 20 year maturity but can be called in 5 years at $1,067.50. No costs other than premium costs would be incurred to call and refund the bonds. yield curve is horizontal and to remain so. what rate of return should an investor expect to earn on these bonds.,,the answer is 7.98% ; how did they get this?