Calculate the Settlement Price (Per $100 of Face Value)on 7

question 31

Essay

Calculate the settlement price (per $100 of face value)on 7 September 2015 of the 4.5% 15 April 2020 Treasury bond at a yield of 4% p.a.(f = 38, d = 183).

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Definitions:

Negative

Used to describe values less than zero, situations of decrease or loss, or aspects considered undesirable or harmful.

Diminishing Marginal Utility

The principle that as a person consumes more of a good, the satisfaction gained from consuming an additional unit decreases.

Pie

A baked dish typically made with a pastry dough casing that contains a filling of various sweet or savory ingredients.

Total Utility

The complete fulfillment obtained through the consumption of a specified quantity of products or services.