Description of this paper

A bond with annual coupon rate of 5.10% and price of $1,090 just yesterday paid a coupon.

Description

solution


Question

A bond with annual coupon rate of 5.10% and price of $1,090 just yesterday paid a coupon. A total of 23 coupons remain to be paid. Suppose you buy the bond at today?s price, hold it and receive 8 coupons, and then sell the bond. If at the time you sell the bond its yield-to-maturity has decreased a total of 50 basis points, find the selling price of the bond. (fyi: 0.01 = 1%= 100 basis points, use semiannual compounding);Additional Requirements

 

Paper#34376 | Written in 18-Jul-2015

Price : $37
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