If the Price of a Two-Year Semi-Annual Pay Bond Is

question 13

Multiple Choice

If the price of a two-year semi-annual pay bond is par (say,$100) ,and the coupon on the bond is 6%,the yield-to-maturity expressed with semi-annual compounding is

• A)5.87%
• B)5.96%
• C)6.00%
• D)6.12%

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Definitions:

Mutually Beneficial Exchanges

Transactions that provide advantages or gains to all parties involved.

Comparative Advantage

The competence of a person, business, or nation to manufacture a product or provide a service with a lesser opportunity cost compared to rivals.