Assume that a $1,000,000 par value, semiannual coupon U.S. Treasury note with three years to maturity (YTM) has a coupon rate of 6%. The yield to maturity of the bond is 11.00%. Using this information and ignoring the other costs involved, calculate the value of the Treasury note:

a.743844.98

b.1050134.09

c.551320.40

d.875111.74

Based on your calculations and understanding of semiannual coupon bonds, complete the following statement:

-assuming the interest rates remain constant, the T-note's price is expected to: _________

-The T-note described is selling at a ___________

- When valuing a semi-annual coupon bond, the time period variable (N) used to calculate the prie of a bond reflects the number of _________ periods remaining in the bond's life.