Question
In: Finance
Suppose that you purchase a Baa rated $1000 semi-annual coupon bond with a 7.5% coupon rate...
Suppose that you purchase a Baa rated $1000 semi-annual coupon bond with a 7.5% coupon rate and a 3-year maturity yielding 5.623%, what would the price be?
Solutions
Expert Solution
Semiannual interest = $1,000 * 0.075 * 6/12 = $37.5
Price = $37.5(PVIFA 2.8115%,6) + $1,000(PVIF 2.8115%,6)
Price = ($37.5 * 5.45119991978) + ($1,000 * 0.84673951422)
Price = $1,051.16
jeff jeffy answered 2 years agoRelated Solutions
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