Calculate the final bond price (clean price + accrued interest) assuming that the bond below was bought on 31^st of July 2021. Minimum lot 1000, face value: 100

Ccy	Issuer	Coupon	Date	Price	Yield
GBP	HSBC	4.5%	16 Dec 2025	104	4.32%

NB: With the majority of non-Gilt bonds, the basis of this accrued interest is calculated on a "30/360" basis. This assumes that each month has 30 days, and each year has 360 days. Please use this basis.

The market price on 31^st of July 2021 was 104, settlement on the same day.

The bond pays a coupon annually and the last payment was on 16 December 2020.

Explain why accrued interest should be added to the clean price

(23 marks for calculations, 7 marks for discussion)