Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. today is 1 july 2021. joan has a portfolio which c

Today is 1 July 2021. Joan has a portfolio which consists of two different types...

50.1K

Verified Solution

Question

Finance

Today is 1 July 2021. Joan has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Joan purchased all instruments on 1 July 2017 to create this portfolio and this portfolio is composed of 204 units of instrument A and 303 units of instrument B. Instrument A is a zero-coupon bond with a face value of 100. This bond matures at par. The maturity date is 1 January 2030. Instrument B is a Treasury bond with a coupon rate of j2 = 3.28% p.a. and face value of 100. This bond matures at par. The maturity date is 1 January 2024. (a) Calculate the current price of instrument A per $100 face value (today's value). Round your answer to four decimal places. Assume the yield rate is j2 =4.47% p.a.

a. 47.5492

b. 56.2873

c. 57.5453

d. 68.6763

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

examples from Iron Jawed Angels film that illustrate women’s relationship to private and public spheres. How...

Psychology
Q

Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the...

Accounting
Q

What plane is labeled as 3 4 5 N 2 3

Biology
Q

7 Rheumatoid Arthritis usually affects joints bilaterally e both the right and left wrist whereas...

Biology
Q

The electric field in an electromagnetic wave is given by E 50 N C sino...

Physics
Q

Which of the following is NOT a characteristic of the chi-square distribution?The chi-square curve approaches,...

Basic Math
Q

Question 6 "All preference shares are classified as equity". Do you...

Accounting
Q

How do I write my philosophy of teaching statement as an accounting student

Accounting
Q

Hugh has the choice between investing in a City of Heflin bond at 3.30 percent...

Accounting
Q

Xenon Company makes watches. The fixed overhead costs for 2019 totql $648,000. The company uses...

Accounting
Q

mh2Q11 ...

Accounting
Q

Compute Lead Time Isaacson Dental Inc. is considering a new lean product cell. The...

Accounting