9 A 5.89% semiannual-pay corporate bond matures 15 August2028 and makes coupon payments on 15 February and 15August. The bond uses the 30/360 day-count convention foraccrued interest. The bond is priced for sale on June 5, 2020(that is, 110 days since the Feb. 15 coupon). What is its flatprice (or clean price) per $ 100 of par value on June 5, 2020 ifits yield to maturity is 4.6% ? Carry intermediate calcs. to fourdecimals. Answer to two decimals.

Coupon rate = 5.89%, Par value = 100, Yield to maturity = 4.6% Since it is a semi-annual pay coupon…

(that is, 110 days since the Feb. 15 coupon). What is its flat price (or clean price) per $ 100 of par value on June 5, 2020 if its yield to maturity is 4.6% ? Carry intermediate calcs. to four decimals. Answer to two decimals.

(that is, 110 days since the Feb. 15 coupon). What is its flat price (or clean price) per $ 100 of par value on June 5, 2020 if its yield to maturity is 4.6% ? Carry intermediate calcs. to four decimals. Answer to two decimals.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter6: Bonds (debt) - Characteristics And Valuation

Section: Chapter Questions

Problem 11PROB

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Concept explainers

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.

Question

A 5.89% semiannual-pay corporate bond matures 15 August
2028 and makes coupon payments on 15 February and 15
August. The bond uses the 30/360 day-count convention for
accrued interest. The bond is priced for sale on June 5, 2020
(that is, 110 days since the Feb. 15 coupon). What is its flat
price (or clean price) per $ 100 of par value on June 5, 2020 if
its yield to maturity is 4.6% ? Carry intermediate calcs. to four
decimals. Answer to two decimals.

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