Find the forward price of bond forward

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Consider a one-year forward contract whose underlying asset is a coupon paying bond with maturity date beyond the expiration date of the forward contract. Assume that the bond pays coupon at the end of every June and December at the coupon rate of 3%, and the face value of the 3 bond is $100. Suppose now it is February 1st and the current market price of the bond is $93.2. Taking the risk-free annual interest rate to be at the constant value of 8%, find the forward price of this bond forward.

Reference no: EM132376738

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