Question: Boeing is rated A. Your thesis is that BA 3 (SA) 5yr, currently at a credit spread of 79 bps, soon will trade at a

Boeing is rated A. Your thesis is that BA 3 (SA) 5yr, currently at a credit spread of 79 bps, soon will trade at a credit spread which is the same as that of the average 5yr A bond (see appendix). Suppose your thesis is correct, and Boeings credit spread tightens immediately, then what will be the new price at which these bonds trade? Answer in base-100 pricing to four decimals; i.e. xxx.xxxx

0yr 1yr 3yr 5yr 7yr 10yr 30yr UST 1.50 1.75 1.95 2.00 2.25 2.50 3.00

Average Credit Spreads, in BPS, for Generic Credit Ratings AAA AA A BBB 5yr 10 25 50 100 10yr 15 35 75 150 30yr 25 75 125 250

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