An investor buys a 9% annual-pay bond maturing July 15, 2020 on September 6, 2013, (51 days after the coupon date using a 30/360 day-count convention). The bond's yield to maturity is 8%. How much (as a percentage of par) will the investor actually pay for the bond? O 106.360 O 104.623 195.206

An investor buys a 9% annual-pay bond maturing July 15, 2020 on September 6, 2013, (51 days after the coupon date using a 30/360 day-count convention). The bond's yield to maturity is 8%. How much (as a percentage of par) will the investor actually pay for the bond? O 106.360 O 104.623 195.206

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter12: Investing In Stocks And Bonds

Section: Chapter Questions

Problem 6FPE

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Question

Give answer with calculation and provide correct and incorrect option explanation

An investor buys a 9% annual-pay bond maturing July 15, 2020 on September 6, 2013, (51 days
after the coupon date using a 30/360 day-count convention). The bond's yield to maturity is 8%.
How much (as a percentage of par) will the investor actually pay for the bond?
106.360
O 104.623
105.206

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