SOA Exam FM Sample Question 189
Study guide: Exam FM-2
A bond with a face value of 1000 and a redemption value of 1080 has an annual coupon rate of 8% payable semiannually. The bond is bought to yield an annual nominal rate of 10% convertible semiannually.
At this yield rate, the present value of the redemption value is 601 on the purchase date.
Calculate the purchase price of the bond.
- A) 911
- B) 923
- C) 956
- D) 974
- E) 984
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