Herry is planning to purchase a Treasury bond with a coupon rate of 2.67% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 7 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.31% p.a. compounded half-yearly. Henry needs to pay 27.8% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. Question 4Answer a. 83.6029 b. 68.6929 c. 82.4233 d. 94.5242

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Question
Herry is planning to purchase a Treasury bond with a coupon rate of 2.67% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this
bond on 7 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.31% p.a. compounded half-yearly. Henry needs to pay 27.8% on
coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. Question 4Answer a. 83.6029 b. 68.6929 c. 82.4233 d. 94.5242
Transcribed Image Text:Herry is planning to purchase a Treasury bond with a coupon rate of 2.67% and face value of $100. The maturity date of the bond is 15 March 2033. (d) If Henry purchased this bond on 7 March 2020, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.31% p.a. compounded half-yearly. Henry needs to pay 27.8% on coupon payment and capital gain as tax payment. Assume that all tax payments are delayed by half year. Question 4Answer a. 83.6029 b. 68.6929 c. 82.4233 d. 94.5242
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