It Is May 1

question 9

Multiple Choice

It is May 1.The quoted price of a bond with a 30/360 day count and 12% per annum coupon in the United States is 105.It has a face value of 100 and pays coupons on April 1 and October 1.What is the cash price? \

• A) 106.00
• B) 106.02
• C) 105.98
• D) 106.04

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Definitions:

Financing

The process of providing or obtaining the funds necessary for investment, purchase, or undertaking a project.

Normal Good

A good whose demand varies directly with income; nearly all goods are normal goods.

Demand

The measure of goods or services that consumers are inclined and able to procure at assorted prices during an established period.

Income

The financial earnings of an individual or entity, typically acquired through employment, business ventures, or other investments.