Question

A bond with 100 redemption value, semiannual coupons of 100r, a term of 10 years and...

A bond with 100 redemption value, semiannual coupons of 100r, a term of 10 years and a yield rate of 10% convertible semi-annually has a book value of 105.84 immediately after the second coupon payment.

Find the book value immediately after the tenth coupon payment.

A. 104.84
B. 103.84
C. 104.38
D. 0
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Answer #1

The question pertains to calculation of the bond price immidiately after the payement of 10th coupon. This can be calculated with the help of the present value formula. The solution is as follows:

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