Question

You are eyeing an investment in Treasury Notes for a full lot (i.e. PAR=$100,000), and find a note with a maturity of 10...

You are eyeing an investment in Treasury Notes for a full lot (i.e. PAR=$100,000), and find a note with a maturity of 100 years. This particular Treasury has a YTM of 3.41%, and a stated rate of interest of 2.52% with a maturity of 100 years. The market price of this treasury is closest to?

a. $146,175.14

b. $39,155.26

c. $74,813.11

d. $74,787.81

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Annual Payment = 0.0252(100,000) = $2,520

Calculating Price,

Using TVM Calculation,

PV = [FV = 100,000, PMT = 2,520, N = 100, I = 0.0341]

PV = $74,813.11

So,

Price = $74,813.11

Please "Like" if you find this correct and comment if you have any doubts.

Add a comment
Know the answer?
Add Answer to:
You are eyeing an investment in Treasury Notes for a full lot (i.e. PAR=$100,000), and find a note with a maturity of 10...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT