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Simple Bond Question

On January 9, 2007 you buy an 8% US Treasury that matures on April 15 2012 for a price of 922.50. calculate the

- accrued interest
- total cost of acquiring bond
- coupon yield

Solution Preview

accrued interest is the interest that has accumulated on a bond since the last interest payment up to, but not including, the

settlement date. Then accrued interest = 80 * 5 = 400 (assuming ...

Solution Summary

The solution calculates the characteristics of the bond.