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(Solved): A 3% coupon Bond with YTM of 2. 5% is maturing in 7months, FV = 100. Last coupon was 5 months ago, a ...



A 3% coupon Bond with YTM of 2. 5% is maturing in 7months, FV = 100. Last coupon was 5 months ago, and next coupon is in 1month. The dirty price of the bond is $101.5364. What is the clean price of the bond?

 

A. $100.2864 B. $100.0364 C. $100 D. $99.2864



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Solution: The formula for calculating the Clean Price of a bond is Clean Price = Dirty Price - Accrued Interest a.Calculation of accrued Interest : As per the information given in the question we have Dirty Price= $ 101.5364 ; Face value of
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