The 5-Year Bond of XYZ Corp

question 27

Multiple Choice

The 5-year bond of XYZ Corp.has a bid quote of 131.2891 and an asked quote of 131.3047.Assume you purchase one of these bonds with a face value of $5,000 and a coupon rate of 7.4 percent,paid semiannually.The next interest payment will be paid two months from today.What will be your invoice price for this purchase?

• A)$7,220.01
• B)$6,690.68
• C)$6,809.47
• D)$7,001.32
• E)$6,549.30

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