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Author Question: Consider a 30 year coupon bond with $75 annual coupons. The next coupon is due one year from today. ... (Read 118 times)

nautica902

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Question 1

Consider a 30 year coupon bond that pays $75 annual coupons (beginning one year from today). What is the sum (undiscounted) of the coupons?
◦ $2,250
◦ $3,015
◦ $2,495
◦ $2,800
◦ $2,500

Question 2

Consider a 30 year coupon bond with $75 annual coupons. The next coupon is due one year from today. Assume that the yield curve is flat and so all yields are 8%, and yields are expected to remain constant over the bond's life. At maturity, how much interest will a bond investor have earned on the reinvested coupons?
◦ $6,246.24
◦ $4,300.25
◦ $2,025.00
◦ $7,754.70
◦ $8,496.24


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Marked as best answer by nautica902 on Apr 25, 2021

gcook

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nautica902

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Reply 2 on: Apr 25, 2021
Gracias!


bdobbins

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Reply 3 on: Yesterday
Excellent

 

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