Accrued Interest and Dirty Price - Mock Test-II, Q# 17.

anirban.dutta
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Location: Kolkata

Accrued Interest and Dirty Price - Mock Test-II, Q# 17.

Postby anirban.dutta » Mon May 12, 2014 8:02 am

Suppose that it is April 4, 2011 and there is a bond with 9% coupon maturing on July 20, 2015 with a quoted price of 90-16 or $90.50. The most recent coupon date is January 20, 2011, and the next coupon date is July 20, 2011. It is a bond with $100 face value. Calculate the accrued interest since the last coupon date and the dirty price per $100 face value for the bond.

Options:
A. $2.09 and $102.09
B. $2.09 and $92.59
C. $1.84 and $101.84
D. $1.84 and $92.34

edupristine
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Accrued Interest and Dirty Price - Mock Test-II, Q# 17.

Postby edupristine » Thu May 15, 2014 8:09 am

Days between January 20 and April 4 is 74; between January 20 and July 20 is 181. Accrued interest on April 4 is (74/181)*$4.5 = $1.84; dirty price = 90.50 + 1.84 = $92.34


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