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    The Following Information Was Available As of The Close of Business June 1, 2004, On Government of Canada Bonds

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    laale dijaan
    This document contains coupon rates and yields for 3 years of a bond. The second year coupon rate is calculated as the average of the first and second year yields, which equals 3.33%. The third year coupon rate is calculated as the average of the first, second, and third year yields, which equals 3.46%. The document uses these calculations to determine the coupon rates for the second and third years that correspond to target average yields of 3.99% for the second year and 3.72% for the third year.

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    The Following Information Was Available As of The Close of Business June 1, 2004, On Government of Canada Bonds

    Uploaded by

    laale dijaan
    30 views2 pages
    This document contains coupon rates and yields for 3 years of a bond. The second year coupon rate is calculated as the average of the first and second year yields, which equals 3.33%. The third year coupon rate is calculated as the average of the first, second, and third year yields, which equals 3.46%. The document uses these calculations to determine the coupon rates for the second and third years that correspond to target average yields of 3.99% for the second year and 3.72% for the third year.

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    Original Title

    The following information was available as of the close of business June 1, 2004, on government of Canada bonds

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    This document contains coupon rates and yields for 3 years of a bond. The second year coupon rate is calculated as the average of the first and second year yields, which equals 3.33%. The third year coupon rate is calculated as the average of the first, second, and third year yields, which equals 3.46%. The document uses these calculations to determine the coupon rates for the second and third years that correspond to target average yields of 3.99% for the second year and 3.72% for the third year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    30 views2 pages

    The Following Information Was Available As of The Close of Business June 1, 2004, On Government of Canada Bonds

    Uploaded by

    laale dijaan
    This document contains coupon rates and yields for 3 years of a bond. The second year coupon rate is calculated as the average of the first and second year yields, which equals 3.33%. The third year coupon rate is calculated as the average of the first, second, and third year yields, which equals 3.46%. The document uses these calculations to determine the coupon rates for the second and third years that correspond to target average yields of 3.99% for the second year and 3.72% for the third year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    of 2

    Coupon 2nd Year 3.

    99%
    6.00% Jun-1-05 105.85 2.67% 3rd Year 3.72%
    11.20% Jun-1-06 113.98 3.33%
    9.20% Jun-1-07 108.11 3.46% 2nd Year Rate =
    3.33% =
    6.66% =
    f2

    3rd Year rate =


    3.46% =
    10.38% =
    f3 =
    (1st year rate +2nd year rate)/2
    (0.0267+f2)/2
    (0.0267+f2)
    3.99%

    (1st year rate +2nd year rate+3rd year rate)/3


    (0.0267+0.0399+f3)/3
    (0.0666+f3)
    3.72%

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