SOA Exam FM Sample Question 340
Study guide: Exam FM-2
A 15-year bond with semiannual coupons is purchased for 2895.28. The bond is redeemable for 1000. The first coupon payment is equal to R and each subsequent coupon is 1% larger than the previous coupon payment. The annual nominal yield rate on this bond is 6.2% convertible semiannually.
Calculate R.
- A) 110
- B) 114
- C) 122
- D) 128
- E) 132
Answer this question and see the worked solution
Concepts tested
- Bond Price
- Geometric Increasing Annuity
- Bonds
- Yield Rate
- Face Value
- Coupon
- Coupon Rate
- Redemption Value
- Market Value