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What is the total price paid by investors a and b

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Question - The XYZ Corporation buys a 20-year bond with a face value of $100,000. The bond pays semi-annual coupons of $2,875 and is redeemable at 104.5. They keep the first 4- years of coupons but sell the last 16 years of coupons to investor A who wishes to yield j2 = 5% and sell the strip bond to investor B who wishes to yield j2 = 5.50%. What is the total price paid by investors A and B to the XYZ Corporation?

Reference no: EM133112624

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