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milu119
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| Posted: 17 May 2009 at 11:32 | IP Logged
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Thanks Divya. Really appreciate for your help.
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kars82
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| Posted: 30 Jun 2009 at 17:55 | IP Logged
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When the question reads as the bonds acquired at 102, plus accrued interest at May 1, then does the price 102 include accrued interest or it doesn't? In some questions where they specifically give interest payment dates, we calculate accrued interest. But sometimes, accrued interest is not calculated. Is there something i am missing???
Help...!!!
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rumboj
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| Posted: 30 Jun 2009 at 18:20 | IP Logged
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The price paid does not include the accrued interest otherwise the question would read "at 102 including accrued interest". The "plus" means in addition to.
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Zeratul
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| Posted: 30 Jun 2009 at 18:37 | IP Logged
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As a general convention when a problem gives the price of a bond as a percentage of par, this is just the price of the bond. It's not usual for accrued interest to be included in this case (personally, I've never seen it). Where you have to watch out is when a dollar amount is provided. In this case it's necessary to ascertain from the problem whether there is accrued interest included.
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kars82
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| Posted: 30 Jun 2009 at 18:38 | IP Logged
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hey thanx a lot..!!! Wish u luck.
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Topic: Questions - Bonds
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