Question
You are given two 1,000 par value n-year bonds. Bond A has 14% semiannual coupons and a price of 1,407.70 to yield rate i compounded
You are given two 1,000 par value n-year bonds.
Bond A has 14% semiannual coupons and a price of 1,407.70 to yield rate i compounded semiannually.
Bond B has 12% semiannual coupons and a price of 1,271.80 to yield the same rate i compounded
semiannually.
Calculate the price of bond A to yield (i-1%) compounded semiannually.
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The Structured Credit Handbook
Authors: Arvind Rajan, Glen McDermott, Ratul Roy
1st Edition
0471747491, 978-0471747499
