Here are the instructions. Answer all of the following questions - all apply to the Company XY 3.5% Notes due 2022 (Fixed Rate)
Issuer: Company XY
Principal Amount: $$2,500,000,000
Maturity: February 9, 2022
Coupon: 3.500%
Price to Public: 99.995% Interest Payment Dates: February 9 and August 9, commencing August 9, 2017
Day Count Convention: 30/360 Benchmark Treasury: 1.775% due January 31, 2022
Benchmark Treasury Yield: 1.921%
Spread to Benchmark Treasury: 58 basis points
Yield: 2.501%
1. If you purchased a $9,000 bond, how much interest do you receive on each bond payment?
2. How does the Company XY bond compare to a benchmark?
3. Are you guaranteed to receive interest payments until 2022? (ignore default risk)
4. How much does Company XY receive for issuing this bond?