Consider the Province of Ontario strip bond in Table 9.1. a. Present calculations to verify, to the

Question:

Consider the Province of Ontario strip bond in Table 9.1.

a. Present calculations to verify, to the nearest dollar, the bond's price on February 26, 2016, based on the quoted yield of 2.66% compounded semiannually.

b. What would the price be on January 1, 2020 if the bond's yield remains the same?

Table 9.1

Issuer Maturity date Price ($) Yield (%) May 30, 2018 March 21, 2019 Province of Saskatchewan 97.73 1.03 Province of Quebec 96.62 1.13 September 15, 2020 July 30, 2021 Province of British Columbia July 9, 2022 Government of Canada 97.09 0.65 Province of Nova Scotia 91.00 1.75 90.24 1.62 September