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Unformatted text preview: P as the ﬁrst payment and then grow by 10% quarterly. Find P . Q6. A 30year bond has 9% annual coupons and a face value of $1,000. It is redeemed at par. Coupons are reinvested at nominal rate of 6% convertible semiannually. Find the bond price P such that the overall yield for the investor is 10% eﬀective per year. Q7. A $1,000 bond with a coupon rate of 9% per year payable semiannually is redeemed at $1,125 after an unspeciﬁed number of years. The yield of this bond is 10% convertible semiannually. If the present value of the redemption value is $225 at this yield rate, ﬁnd the bond price. Q8. A $1,000 bond with a coupon rate of 6% per year payable semiannually is redeemed at par on July 1, 2017. Its purchase price on July 1, 2009 is 1015.85. Find its book value on January 1, 2012. 1...
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This note was uploaded on 01/21/2011 for the course ACTSC 231 taught by Professor Chisholm during the Fall '09 term at Waterloo.
 Fall '09
 Chisholm

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