Question

In: Finance

Compute the conversion factor on a semi-annual 7.2% coupon bond, which matures in exactly 8 years....

Compute the conversion factor on a semi-annual 7.2% coupon bond, which matures in exactly 8 years.

A.

1.0346
B.

1.5276
C.

0.9661
D.

1.0754

Solutions

Expert Solution

=1/1.03^(0/6)*(0.072/2+1/1.03^(2*8)+0.072/0.06*(1-1/1.03^(2*8)))-(0.072/2*(6-0)/6)
=1.075366612

jeff jeffy answered 2 years ago
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