A five-year floater resets every six months to six-month LIBOR plus 100 basis points. The floater currently sells for $102.11 per $100 of face value. Six-month LIBOR is 6%. The amount of the assumed coupon that you use to calculate the discount margin for the floater is: Group of answer choices: $3 per $100 of face value $6 per $100 of face value $3.5 per $100 of face value $7 per $100 of face value
A five-year floater resets every six months to six-month LIBOR plus 100 basis points. The floater currently sells for $102.11 per $100 of face value. Six-month LIBOR is 6%. The amount of the assumed coupon that you use to calculate the discount margin for the floater is: Group of answer choices: $3 per $100 of face value $6 per $100 of face value $3.5 per $100 of face value $7 per $100 of face value
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A five-year floater resets every six months to six-month LIBOR plus 100 basis points. The floater currently sells for $102.11 per $100 of face value. Six-month LIBOR is 6%. The amount of the assumed coupon that you use to calculate the discount margin for the floater is:
Group of answer choices:
$3 per $100 of face value
$6 per $100 of face value
$3.5 per $100 of face value
$7 per $100 of face value
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