Question: could you use basic formula, discount formula, and premium formula? not excel,plz Question 1 Suppose a 2 year bond with F = C = 1000,
could you use basic formula, discount formula, and premium formula? not excel,plz
Question 1 Suppose a 2 year bond with F = C = 1000, and a nominal annual coupon rate convertible semian- nually of 10% is purchased at a price to yield 8% convertible semiannually. (a) Calculate the price of the bond using the basic formula, and the premium/discount formula. Hint: 1036.30 (b) Calculate the BV after 1 year (2 terms). Hint: 1018.86 (c) Calculate the amount of interest in the third coupon. Hint: 40.75 (d) Calculate the amount of amortization of premium in the third coupon. Hint: 9.25 Question 1 Suppose a 2 year bond with F = C = 1000, and a nominal annual coupon rate convertible semian- nually of 10% is purchased at a price to yield 8% convertible semiannually. (a) Calculate the price of the bond using the basic formula, and the premium/discount formula. Hint: 1036.30 (b) Calculate the BV after 1 year (2 terms). Hint: 1018.86 (c) Calculate the amount of interest in the third coupon. Hint: 40.75 (d) Calculate the amount of amortization of premium in the third coupon. Hint: 9.25
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