Bond Pricing between coupon payments You are considering buying a semi-annual bond that has 13 coupon payments

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Bond Pricing between coupon payments

You are considering buying a semi-annual bond that has 13 coupon payments remaining, with the next coupon payment occurring 21 days from the settlement date. The bond's coupon rate is 9.9%
and similar bonds are reported to have a yield of maturity of 7.4% There are 182 days between the bond's coupon payments.

a) What is the maximum price that you are willing to pay for the bond? $

b) If your assumptions are correct then what is the estimated quoted price (remember quotes are a percent of par value)? $

Posted Date: Oct 19, 2021 12:14 PM

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Bond Pricing between coupon payments You are considering buying a semi-annual bond that has 13 coupon payments

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To answer your questions we need to use the bond pricing formula that discounts the future cash flow... View the full answer

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