Question

You are considering a coupon bond (par=$1,000) that pays semi-annual interest with a coupon rate of...

You are considering a coupon bond (par=$1,000) that pays semi-annual interest with a coupon rate of 6%. The bond currently has a bid price of 116.89 and an ask price of 117.00. If the last interest payment was made 60 days ago, and there are 180 days between the last interest payment and the next interest payment, what is the invoice price of the bond?

A.

$1,180.0
B.

$1,170.0
C.

$1,190.6
D.

$1,168.9

You purchase a 10-year T-note which has a par value of $1,000 and a yield-to-maturity of 8%. Its coupon rate is 9%. If one year later the yield decreases to 7%, and if you sell your bond after receiving interest payments, what is your holding period return?

A.

14.4%
B.

13.6%
C.

15.2%
D.

16.8%
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