Coupon bond question
You want to purchase a 10year coupon bond with semiannual coupons and an annual coupon rate of 6%. The face value of the bond is $10,000. You observe a yield curve with spot rates that increase 25 basis points for every six month increase in the term of a loan. These rates are nominal, annual quotes. Given that the present value of a $2,000 face value zerocoupon 6month bond is $1,941.75, what is the price of the 10year bond? Assume the risk on both bonds is the same, and interest is compounded on a semiannual basis. Provide calculations out to four decimal places for partial credit. Thanks for helping
