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Consider a 10-Y bond annual-paid with 4% coupon. Assume 5% yield. A. Calculate the clean price of the bond? B. Calculate the price of the
Consider a 10-Y bond annual-paid with 4% coupon. Assume 5% yield.
A. Calculate the clean price of the bond?
B. Calculate the price of the bond if the half of the principal is paid after 5 years and the half paid after 10 years while the coupon of is based on the outstanding principal (ie. from year 6 to year 10, coupon will be only based on half of the original principal)?
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