Determine the interest payment for the following three bonds. (Assume a $1,000 par value) (Round your...

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Answer 1

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Answer #1

Interest payment on corporate bone:-

Face value - 1000

Interest rate- 3.80%(paid semi annually)

Interest payment=1000×3.80×6/12

=$19

Interest payment on treasury note:-

Treasury notes are issued by the U.S government with semi annual coupon payments.

Face =1000

Coupon-4.55%

Interest payment=1000×4.55%×6/12

=$22.75

Interest payment on zero coupon bond:-

In zero coupon bond interest rate is 0, yield on the bond will arise during the maturity.

Answer 2

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