Question
Issue Date May 16, 2016 Maturity Date May 16, 2028 Tenor 12 years Total amount applied for 1,884,301,000.00 Total amount offered 1,000,000.000.00 Total amount allotted
Issue Date | May 16, 2016 |
Maturity Date | May 16, 2028 |
Tenor | 12 years |
Total amount applied for | 1,884,301,000.00 |
Total amount offered | 1,000,000.000.00 |
Total amount allotted | 1,162,913,000.00 |
Issue Yield | 4.75% |
Coupon rate | 4.50% |
Cut-off price | 97.73 |
Range of successful bidders | 125.00-97.73 |
Face value allotted to non-competitive applications | 20,419,000.00 |
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Based on the Auction Results provided, the bonds were issued at a yield (YTM) of 4.75%,
with a price of $977.30 (per $1,000 face value). Using your knowledge of bond calculations,
prove the accuracy of:
i. The Bond Price (based on the YTM of 4.75%) 8 Marks
ii. The Yield to Maturity (based on the price of $977.30). 6 Marks
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