Actual accrued interest
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4. An 8% coupon U.S. Treasury note pays interest on May 30 and November 30 and is
traded for settlement on August 15. The accrued interest on the $100,000 face value of this note is _________. (Use actual/actual day-count convention)
A. $491.80
B. $800.00
C. $983.61
D. $1,661.20
E. none of the above
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This solution is comprised of a detailed explanation to answer how much is the accrued interest.
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Since the payment of interest is made on May 30 and November 30, it means that the interest is paid twice a year. If you want to find interest for each period, you will have to divide $8,000 by 2.
actual/actual accrued interest.
4. An 8% coupon U.S. Treasury note pays interest on May 30 ...
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