Ask Question
BusinessBusiness
3 November, 04:53

A zero-coupon bond is selling at a deep discount price of $450. It matures in 11 years. If the yield to maturity of the bond is 6.2%, what is the duration of the bond (rounded to two places)

+5
Answers (1)
  1. 3 November, 06:52
    0
    Duration is 11 years

    Explanation:

    The Duration of a zero coupon bond is equal to it's maturity. Since it matures at 11 years the duration of the bond is therefore also 11 years.

    It is a bond that pays no interest. A zero-coupon bond is a bond where the face value is what is repaid during the time of maturity. There are no periodic interest payments, or have so-called coupons, that is why they are referred to as zero-coupon bond. Investor gets par value when it matures.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “A zero-coupon bond is selling at a deep discount price of $450. It matures in 11 years. If the yield to maturity of the bond is 6.2%, what ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
The purpose of this category of interview questions as to obtain factual information about the interviewee A. General information questions B. Behavioral questions C. Character questions D. Stress questions
Answers (1)
What term is used to describe the interest rate charged by the central bank when it makes loans to commercial banks?
Answers (1)
You own a bond that has a 7% coupon and matures in 12 years. You purchased this bond at par value when it was originally issued. If the current market rate for this type and quality of bond is 7.5%, then you would expect: A.
Answers (1)
A sofa is on sale for $187.20, which is 26% of the regular price. what is the regular price?
Answers (1)
You heard somebody say, Marketing is just sales and advertising" Discuss the accuracy of this statement
Answers (1)
New Questions in Business
When is halfway through the grade school year?
Answers (1)
Stuart Manufacturing Company established the following standard price and cost data. Sales price $ 8.80 per unit Variable manufacturing cost $ 3.
Answers (1)
Kincaid Company's Retained Earnings balance on January 1 was $9,000. During the current year, Kincaid earned $3,100 in revenues and incurred $4,300 in expenses. Kincaid declared and paid $3,000 in dividends, all in cash.
Answers (1)
Cotton Brokers, Inc., enters into a contract to sell denim clothing to Delite Natural Fashion store, which in turn sells a pair of jeans to Esmé, a consumer. In comparison to standards that apply to consumers, the UCC imposes on merchants A.
Answers (1)
Globalization of the economy has been led primarily by transnational corporations. what do these corporations do?
Answers (1)
Home » Business » A zero-coupon bond is selling at a deep discount price of $450. It matures in 11 years. If the yield to maturity of the bond is 6.2%, what is the duration of the bond (rounded to two places)
Sign Up Forgot Password?