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Brilliant_brown [7]
3 years ago
9

Apisco Tiger Inc. has a 6.6 percent semi-annual coupon bond outstanding. There are 183 days from the last coupon date to the nex

t, and the last coupon payment occurred 74 days ago. What is the bond's dirty price if it's quoted price is $1,026.00
Business
1 answer:
hram777 [196]3 years ago
5 0

Answer:

Calculate the dirty price.

Here, coupon interest is compounded semiannually. Hence, divide coupon rate by 2.  

Dirty Price = Bond Clean Price + Accrued Interest

Dirty Price = Bond Clean Price +(Face Value X Coupon Rate/2 X Day Count/ Total Days

Dirty price = 1026 + (1000 x 6.6%/2 x 74/183)

Dirty price = $1,039.34

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