Q15. The FIM bank has issued two bonds, the first bond is a 3-year coupon paying bond with 10% of coupon rate. The second bond is a 30-year zero-coupon bond. The face value for two bonds are $100....

Q15. The FIM bank has issued two bonds, the first bond is a 3-year coupon paying bond with 10% of coupon rate. The second bond is a 30-year zero-coupon bond. The face value for two bonds are $100. Assume the yield curve is flat and the yield to maturity is 10%. Which of the following is correct?

The bond price for the second bond is $5.73, and the duration for the second bond is 29.5 years

The bond price for the first bond is $85.3, and the duration for the first bond is 2.73 years

The bond price for the first bond is $98, and the duration for the first bond is 2.73 years

The bond price for the second bond is $5.73, and the duration for the second bond is 30 years

The bond price for the first bond is $100, and the duration for the first bond is 3 years

Jun 11, 2022

SOLUTION.PDF

Q15. The FIM bank has issued two bonds, the first bond is a 3-year coupon paying bond with 10% of coupon rate. The second bond is a 30-year zero-coupon bond. The face value for two bonds are $100....

Get Answer To This Question

Related Questions & Answers

Submit New Assignment