Assignment 9 Solutions

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School
Langara College **We aren't endorsed by this school
Course
MATH 1118
Subject
Finance
Date
May 27, 2023
Pages
1
Uploaded by CountClover14127 on coursehero.com
rt;;J; - �-;-! i t ,fit, ,, ..,�v1 �pt>/ 21>Z i( �f:l&.l/ '2.!v.z', Z., L.j O (10 Marks) A $1000 bond maturing at 106 on November 1 st , 2040 pays interest at 8% compounded semi-annually. Find the purchase price on May 1 s t , 2024 to guarantee an investor a yield of 9% compounded semi-annually. p ,., 7 .::. {::.-,.::... /DtJ�{P.J?'f)::: (,,v q .I/1 2.. t/1 2 c/1 PJ/ - ) v o o .,x. I 06 ") ::: /9 6 "D 33 rJ C/'r (1 ll +-'to 1 .,., .,.. + )tJ/p �JI --"':> - '9 :J l - q 2- 1 12f _; qD Find the purchase price on July 1 st , 2024 to guarantee an investor a yield of 9% compounded semi-annually. What would be the market quotation on the bond on July 1 st 2024? L= k�F },'ii (t t J� l3-2b . q - - I - /fJO [£_ F If an investor bought this bond on May 1 s t , 2026 at the price of $922. 36 and sold the bond on May 1 st , 2030 at a price of 993.66 what yield rate did they realize (over the four year holding period)? 2_ P / - o/2 2- 3t � tJ -z.._ C / 7 -f 9'1J,[pt �/) g IV C/T ½ IP , 2t 't · + it D P T r ; 'tJ . 2 1 ;( J � 2 Mathematics of Finance Assignment 9
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