Question
A 10-year Treasury bond with a $1,000 par value has a 12% coupon and pay interest every 6 months. The bond is three years old and has just made its sixth payment. If interest rates fell to 8%, what would price would these bonds sell at?
A. $1,208.25
B. $1,250.51
C. $1,211.26
D. $1,271.81
Summary
The question belongs to Finance and it is about calculation of current selling price of a bond.