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Problem 3 [4 points] a. A deposit account pays X% per annum with continuous compounding, but interest is actually paid quarterly. Suppose $300 interest will
Problem 3 [4 points] a. A deposit account pays X% per annum with continuous compounding, but interest is actually paid quarterly. Suppose $300 interest will be paid each quarter on a $10,000 deposit. Find X. [2 pts] b. A three-year bond with a face value of $100 provides a coupon of 8% semiannually and has a cash price of 104 . What is the bond's yield? [2 pts]
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