Question
The British government has an outstanding perpetual bond (aka consol) paying $100 per quarter forever. Assuming an effective annual rate (EAR) of 4.0604%, the value
The British government has an outstanding perpetual bond (aka consol) paying $100 per quarter forever. Assuming an effective annual rate (EAR) of 4.0604%, the value of the bond immediately before a payment is made is closest to ________.
a. $9,851
b. $10,100
c. $9,951
d. $10,000
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Financial Institutions Management A Risk Management Approach
Authors: Anthony Saunders, Marcia Cornett
6th Edition
0077211332, 9780077211332
