Chloe is planning to purchase a Treasury bond paying a (j2) coupon rate of 4.05% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Chloe purchased this bond on 6 March 2020, what is her purchase price (rounded to four decimal places)? Assume a yield rate of 3.74% p.a., compounded half-yearly. Chloe needs to pay 26% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half-year. a. $91.1196 b. $78.2736 c. $92.9081 d. $105.0643.
Chloe is planning to purchase a Treasury bond paying a (j2) coupon rate of 4.05% p.a. The face value of the bond is $100. Its maturity date is 15 March 2033; the bond matures at par. If Chloe purchased this bond on 6 March 2020, what is her purchase price (rounded to four decimal places)? Assume a yield rate of 3.74% p.a., compounded half-yearly. Chloe needs to pay 26% of coupon payments and capital gains in tax. Assume that all tax payments are delayed by a half-year. a. $91.1196 b. $78.2736 c. $92.9081 d. $105.0643.
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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Chloe is planning to purchase a Treasury bond paying a (j2) coupon rate of 4.05% p.a. The face
If Chloe purchased this bond on 6 March 2020, what is her purchase price (rounded to four decimal places)? Assume a yield rate of 3.74% p.a., compounded half-yearly. Chloe needs to pay 26% of coupon payments and
a.
$91.1196
b.
$78.2736
c.
$92.9081
d.
$105.0643.
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