7. Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For the valuation of bonds that make semiannu...

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7. Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For the valuation of bonds that make semiannual pay

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Answer 1

Answer #1

1: Option 1

Using financial calculator

Input: FV= 1000,000

N=3*2=6

PMT=3%*1000000/2= 15000

I/Y=7.7/2= 3.85

PV = -876,205.93

2: T Note is selling at a discount.

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Answer 2

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