John will purchase a bond with a face value of $1,000.00. The quoted price is 123. The coupon rate is 5% and 53 days have passed since the last coupon payment. How much should John be willing to pay for the bond? Hint: Assume 182 days between coupon payments (semi-annual coupon). Round your answer to the nearest two decimals.
John will purchase a bond with a face value of $1,000.00. The quoted price is 123. The coupon rate is 5% and 53 days have passed since the last coupon payment. How much should John be willing to pay for the bond? Hint: Assume 182 days between coupon payments (semi-annual coupon). Round your answer to the nearest two decimals.
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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John will purchase a bond with a face value of $1,000.00. The quoted price is 123. The coupon rate is 5% and 53 days have passed since the last coupon payment. How much should John be willing to pay for the bond? Hint: Assume 182 days between coupon payments (semi-annual coupon). Round your answer to the nearest two decimals. Do not type the $ symbol.
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