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Consider a coupon bond with 10 years to maturity, an annual coupon rate 6.5% (coupons are paid semiannually), and nominal value $1,000. Suppose that the
Consider a coupon bond with 10 years to maturity, an annual coupon rate 6.5% (coupons are paid semiannually), and nominal value $1,000. Suppose that the semiannually compounded yield to maturity of this bond is 5.5%. What is the current price of the bond using the annuity formula?
| A. | $1,076.14 | |
| B. | $1,216.14 | |
| C. | $1,006.14 | |
| D. | $1,346.14 |
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