Question: A 7-year $1000 par value bond with 10% semiannual coupons was sold on April 1, 2000, which yields 8% convertible semiannually. The coupons were payable
A 7-year $1000 par value bond with 10% semiannual coupons was sold on April 1, 2000, which yields 8% convertible semiannually. The coupons were payable at the beginning of October and April after the purchase. On June 25, 2005, the owner wished to know the dirty and clean values of this bond. Use both theoretical method and practical method, with the 30/360 method for figuring day counts. (Answers: $1055.44, $1032.35 by theoretical method, $1055.64, $1032.31 by practical method). Please show all work and numerical equation.
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