A Treasury bond is quoted at a price of 105:21. What is the market price of this bond if the face value is $1,000?

A) $105.21
B) $106.56
C) $1,052.10
D) $1,056.56
E) $1,065.60

Question

A Treasury bond is quoted at a price of 105:21. What is the market price of this bond if the face value is $1,000?A)  $105.21B)  $106.56C)  $1,052.10D)  $1,056.56E)  $1,065.60

Kalaivani Kumar · Accepted Answer

Final Answer : D, Explanation :  The market price of the bond is calculated by taking the quoted price and converting it into a dollar amount based on the face value of the bond. The quoted price of 105:21 means 105 and 21/32 percent of the face value. To convert this to a dollar amount: 105 + (21/32) = 105.65625% of $1,000 = $1,056.56.

A Treasury bond is quoted at a price of 105:21. What is the market price of this bond if the face value is $1,000?

A) $105.21
B) $106.56
C) $1,052.10
D) $1,056.56
E) $1,065.60

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