An inflation-indexed treasury bond

Assignment Help Financial Management

Reference no: EM131989951

An inflation-indexed Treasury bond has a par value of $1,000 and a coupon rate of 6 percent. An investor purchases this bond and holds it for one year. During the year, the consumer price index increases by 1 percent every six months. What are the total interest payments the investor will receive during the year?

Reference no: EM131989951

Questions Cloud

What is your net profit on position : If you sell these options today on 10,000 SGD and at maturity SGD is quoted at bid price of 0.81 USD/SGD, what is your net profit on this position?

You make the first deposit at the end of the first year : you deposit the money in a bank account that pays 4% interest, and you make the first deposit at the end of the first year.

Internal rate of return-payback period for projects aspire : A calculation of the Net Present Value (NPV), Internal Rate of Return (IRR) and Payback Period for projects Aspire and Wolf.

How can investors guide against inflationary economy : How can investors guide against an inflationary economy that may erode the value of their investments?

An inflation-indexed treasury bond : An inflation-indexed Treasury bond has a par value of $1,000 and a coupon rate of 6 percent.

Principle remaining outstanding at end of month seven equals : What is the effective annual rate of return on Rossie stock? Principle remaining outstanding at end of month seven equals?

What is the share price at the end of supernormal growth : If the required return is 15 percent and the company just paid a $2.88 dividend, what is the share price at the end of supernormal growth (at Year 3)?

What is the clean price of bond : The bond has a coupon rate of 6.7 percent, and there are 2 months to the next semiannual coupon date. What is the clean price of the bond?

What is the current yield on bonds : Capital Corp. has 6.4 percent coupon bonds on the market. The bonds currently sell for 110 percent of par. What is the current yield on the bonds?

User Account

All Pages