Alberta Capital Finance Authority issued a 20-year $100,000 bond on December 15, 2005, with a coupon rate of 4.45%. If Mirabelle purchased the bond on June 15, 2007, at a market rate of 4.56% and subsequently sold the bond on March 31, 2009, at a market rate of 3.74%, determine the amount by which the market price increased or decreased for Mirabelle. (The answer is $10,122.56 in
Alberta Capital Finance Authority issued a 20-year $100,000 bond on December 15, 2005, with a coupon rate of 4.45%. If Mirabelle purchased the bond on June 15, 2007, at a market rate of 4.56% and subsequently sold the bond on March 31, 2009, at a market rate of 3.74%, determine the amount by which the market price increased or decreased for Mirabelle. (The answer is $10,122.56 in
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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The Alberta Capital Finance Authority issued a 20-year $100,000 bond on December 15, 2005, with a coupon rate of 4.45%. If Mirabelle purchased the bond on June 15, 2007, at a market rate of 4.56% and subsequently sold the bond on March 31, 2009, at a market rate of 3.74%, determine the amount by which the market price increased or decreased for Mirabelle.
(The answer is $10,122.56 increse but I need help with the process. Thank you in advance!)
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