Question
Suppose that 6-month, 12-month and 18-month zero rates are 4%, 4.5% and 4.8% per annum with continuous compounding respectively. What is the cash price of
Suppose that 6-month, 12-month and 18-month zero rates are 4%, 4.5% and 4.8% per annum with continuous compounding respectively. What is the cash price of a bond with a face value of 1,000 that will mature in 18 months and pays a coupon rate of 5% per annum semiannually?
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Financial Markets And Institutions
Authors: Jeff Madura
6th Edition
0324162618, 978-0324162615
