Question
You invest in MAC Corp's new Bond issue. The 20-year maturity semi-annual pay bond has a bullet cash flow structure. The bond has a floating
You invest in MAC Corp's new Bond issue. The 20-year maturity semi-annual pay bond has a bullet cash flow structure. The bond has a floating rate coupon which resets based off of the 6M Libor Benchmark.
Assume 6M Libor is 0.65% the Quoted Margin (QM) is 2.00% and the Discount Margin (DM) is 4.60%.
Based on this information, what is the value (price) of the bond assuming $100 of par value (closest to)?
| $97.71 | ||
| $94.12 | ||
| $100 | ||
| $68.04 | ||
| $102.11 |
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Fundamentals Of Investments
Authors: Bradford Jordan, Thomas Miller
4th Edition
0073314978, 9780073314976
