Question
Please answer all, this is one question split into parts. Will thumbs up, please show answers clearly & work. Thank you Expert! 1) The following
Please answer all, this is one question split into parts. Will thumbs up, please show answers clearly & work. Thank you Expert!
1)
The following is the Treasury bond quote as of March 26th, 2021. Assume the face (par) value of the Treasury bond is $100,000 and the bond pays interest semiannually.
Is this a premium bond or a discount bond? What is the asked yield to maturity (YTM) of the Treasury bond? What is its effective annual YTM? What is its current yield? What was the previous days asked price (in dollars) for this bond? If you expect the YTM to remain unchanged, what is the expected price of the bond next year (i.e., March 26th, 2022)?
If the bid-ask spread for this bond is .035, what is the bid price of this bond in dollars?
\begin{tabular}{clcrrc} Coupon Rate & Maturity & & & & Ask \\ & Date & Bid & Asked & Chg & Yld (YTM) \\ \hline 2.7% & March 26th,2032 & ? & 95.835 & +.153 & ? \end{tabular} \begin{tabular}{clcrrc} Coupon Rate & Maturity & & & & Ask \\ & Date & Bid & Asked & Chg & Yld (YTM) \\ \hline 2.7% & March 26th,2032 & ? & 95.835 & +.153 & ? \end{tabular}Step by Step Solution
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