Question
Matthew is interested in a 30-year 7.625% $50,000 bond redeemable at par and has semiannual coupons. Immediately after receiving the coupons, he can reinvest them
Matthew is interested in a 30-year 7.625% $50,000 bond redeemable at par and has semiannual coupons. Immediately after receiving the coupons, he can reinvest them at a nominal annual interest rate of 6% compounded monthly.
Determine the price that Matthew should pay if he wants to realize a yield rate of 8% over the 30-year period.
ACTUARIAL NOTATION PLEASE!
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The Oxford Handbook Of Computational Economics And Finance
Authors: Shu-Heng Chen, Mak Kaboudan, Ye-Rong Du
1st Edition
0199844372, 978-0199844371
