Question

A coupon bond that pays semiannual interest is reported in the Wall Street Journal as having an ask price of 113% of its $1,000 par value. If the last interest payment was made 3 months ago and the coupon rate is 5.60%, the invoice price of the bond will be _________. Multiple Choice

Answer 1

Answer:

$1,144.00

Explanation:

Calculation for the invoice price of the Bond

Invoice price = 1.13(1,000) + 28.00(3/6)

Invoice price=$1,130+$14

Invoice price= $1,144.00

Therefore the Invoice price of the Bond will be $1,144.00