An analyst gathers the following information about two similarly rated 8% semiannual coupon payment bonds: Bond 1 Bond 2 Price 114.243 112.691 Years to maturity. 3 5 Yield to maturity. 3% 5% Q. Using matrix pricing, the price per 100 of par value of a 4-year semiannual coupon payment bond with similar credit quality and a 7.6% annual coupon is closest to: Confirm A. 113.07. B. 113.19. C. 113.47.

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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Question
An analyst gathers the following information about two similarly rated 8%
semiannual coupon payment bonds:
Bond 1 Bond 2
Price 114.243
112.691
Years to maturity. 3
5
Yield to maturity. 3%
5%
Q. Using matrix pricing, the price per 100 of par value of a 4-year
semiannual coupon payment bond with similar credit quality and a 7.6%
annual coupon is closest to:
Confirm
A. 113.07.
B. 113.19.
C. 113.47.
Transcribed Image Text:An analyst gathers the following information about two similarly rated 8% semiannual coupon payment bonds: Bond 1 Bond 2 Price 114.243 112.691 Years to maturity. 3 5 Yield to maturity. 3% 5% Q. Using matrix pricing, the price per 100 of par value of a 4-year semiannual coupon payment bond with similar credit quality and a 7.6% annual coupon is closest to: Confirm A. 113.07. B. 113.19. C. 113.47.
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