A bond with a maturity of 3 years has the following characteristics: the face value...
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A bond with a maturity of 3 years has the following characteristics: the face value is F = 100, the coupon rate is 8% p.a. and YTM (yield to maturity) is 11%. Knowing that the coupon is paid semi-annually, calculate the price of the bond with semi-annual discrete compounding, and with quarterly discrete compounding. How is the price of the bond changing when the compounding frequency is changing?
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