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The current price of a bond is $950. It has a face value of $1,000, a maturity date of 2 years and pays a 4% coupon rate
Posted: Mon Nov 15, 2021 5:16 pm
by answerhappygod
- The Current Price Of A Bond Is 950 It Has A Face Value Of 1 000 A Maturity Date Of 2 Years And Pays A 4 Coupon Rate 1 (40.42 KiB) Viewed 74 times
The current price of a bond is $950. It has a face value of $1,000, a maturity date of 2 years and pays a 4% coupon rate every year. Calculate the price if the yield is 5%, and when it is 9%. Use linear interpolation to estimate the correct yield. C1 C2 Ce+ F P= + (1+r) 1 (1+r)2 (1+r) +... Price is low r= plow + Price correct (high - plow) Price is low – Pricer is high