# Could you plz explain how we solve (n) and (k) ?? Treasury Bond Pricing • Pricing...

###### Question:

could you plz explain how we solve (n) and (k) ??

Treasury Bond Pricing • Pricing between coupon dates - adjust for final coupon payment Example: Treasury Bond Pricing • An existing Treasury bond has been issued with a face value of $1000. The bond pays half-yearly coupons of 7% p.a., and matures on 15 November 2017. Assume that the bond is sold on 15 July 2014. Current yields for similar Treasury bonds are 8% p.a. • Calculate the price of the bond in the secondary market. Example: Treasury Bond Pricing Hence we can determine the relevant inputs into the formula as follows: - Coupon payment (C) = 7%/2 x$1000 = $35 - Face Value (A) =$1000 - Interest rate (i) = 8%/2 = 0.04 - k (fraction elapsed) = 61/184 (see next slide) - n(number of periods remaining) = 7 (see next slide) P-C1-(1+1) +A(1+y)(1+* whore: i-the nominal interest rate per period expressed as a decimal the number of coupon periodo R the traction of the elapsed interest period since the last coupon payment C-periodio coupon payments A = the face value of the bond Flinders Flinders Flinders LAMPIC leasury Dume Cing Example: Treasury Bond Pricing Number of periods Number of days since last remaining (n): coupon as fraction (k): Example: Treasury Bond Pricing . So plumbing the numbers in Days Held Total days May '16 16 p={(142=//="]= (1+1)+"ya+y* ncial calculator but most uts would be very 15 Nov 14 15 May 15 15 Nov 15 15 May 16 15 Nov 16 15 May 17 15 Nov 17 P s3s 1-(1+0.04)-7 04)-7 (1+0.04)184 0.04 = [$210.07 +$759.92]1.013087 -$982.68 VAPP ride 969 V1.4 0.3315 in), COMP] (FV] Flinders Flinders Flinders ## Answers #### Similar Solved Questions 1 answer ##### 1. (10 points) Propose a synthesis of the following compound with one of your intermediate products... 1. (10 points) Propose a synthesis of the following compound with one of your intermediate products must be an anime for full credit. 2. (10 points) draw the correct product for the reaction below. For step 2, draw the reaction mechanism. be shre to include important intermediate compounds, electro... 1 answer ##### Ibaka Inventions has a debt-equity ratio of 4. Earnings for next year are estimated at$60,000....
Ibaka Inventions has a debt-equity ratio of 4. Earnings for next year are estimated at $60,000. Capital spending is estimated at$200,000 for next year. If the company follows a fixed dividend policy, with payout of 30%, what is the estimated total dividend ?...
##### A capacitor of capacitance 471 μF is discharged through a resistor of 72 kΩ. Find the time required by the capacitor to...
A capacitor of capacitance 471 μF is discharged through a resistor of 72 kΩ. Find the time required by the capacitor to discharge 54 percent of its maximum charge....
##### You are experiencing a global shift and changing of society's awareness of just how fragile and...
you are experiencing a global shift and changing of society's awareness of just how fragile and connected we are. This class consists of students majoring in Earth Science, Environmental Science, Sustainability Science, and Environmental Biology. All of these fields are intricately linked to the...
##### If a major drought in the United States causes a decrease in supply for soybeans, thus...
If a major drought in the United States causes a decrease in supply for soybeans, thus an increase in price and decrease in quantity consumed, then the supply curve shifts to the left and the demand curve shifts to the right the supply curve shifts to the left and the demand curve shifts to the left...
##### In this set of exercises (in the pre-lab AND lab), we will test/make the following assumptions:...
In this set of exercises (in the pre-lab AND lab), we will test/make the following assumptions: A flow exists in a complete circuit from one terminal of the battery, through the rest of the circuit, back to the other terminal of the battery, through the battery and back around i. the circuit. We wil...
##### How do you find all the values that make the expression undefined: (m+4)/(m - 6)?
How do you find all the values that make the expression undefined: (m+4)/(m - 6)?...
##### The total sales made by a salesperson was $25,000 after 3 months and$68,000 after 23 months
The total sales made by a salesperson was $25,000 after 3 months and$68,000 after 23 months. Predict the total sales after 42 months....