Question: Question 4 Consider a 30-year US Treasury bond with a 5.75% coupon rate and a par value of $1,000. This bond makes semi-annual coupon payments.

Question 4 Consider a 30-year US Treasury bond with a 5.75%

Question 4 Consider a 30-year US Treasury bond with a 5.75% coupon rate and a par value of $1,000. This bond makes semi-annual coupon payments. What is the price of this bond when its yield is 3.75%? Explain your answer clearly. [6 marks]

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