Assume a bond matures for $1000 ten years and two months from
today. It also pays...
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Assume a bond matures for $1000 ten years and two months fromtoday. It also pays semiannual coupons with an annual coupon rateof 8%. Calculate the dirty (cash) and clean prices of the bond ifthe bond’s yield to maturity equals 9%. (Show Work)
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Calculating Dirty price of the bondFace Value 1000 Annual coupon rate 8 Yield to maturityof bond YTM 9Since the bond pays coupon semiannuallySemi annual coupon Coupon rate x par value 2 8 x 1000 2 80 2 40Semi annual yield to maturity r Yield to maturity 2 9 2 45Time to maturity 10 years and two
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