Ask Question
16 November, 03:16

In November 2017, Treasury 4 1/2s of 2044 offered a semiannually compounded yield to maturity of 2.66%. Recognizing that coupons are paid semiannually, calculate the bond's price. Assume face value is $1,000. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

+5
Answers (1)
  1. 16 November, 03:43
    0
    The price of a bond is $492.24

    Explanation:

    F = face value of bond = $1000

    T=time to maturity of bond = 2044-2017 = 27 years

    r=yield to maturity=2.66% semi-annulay=0.0266

    Formula to calculate price = F / (1+r) ∧T

    we have = 1000 / (1+.0266) ∧27 = 1000/2.0315 = $492.24
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “In November 2017, Treasury 4 1/2s of 2044 offered a semiannually compounded yield to maturity of 2.66%. Recognizing that coupons are paid ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers