You can buy or sell a 6 1000 par us treasury note that


You can buy or sell a 6% $1000 par U.S. Treasury Note that matures in exactly 4 years (meaning it pays (.06/2)*1000 coupon payments every 6 months starting 6 months from now through maturity, and repays principal on maturity), with a current yield to maturity of 5% (assume a flat term structure of interest rates), for a price today of $1,040.12. Assume semi-annual compounding and coupon payments. What is it currently worth? Would you buy it or sell it? How?

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Financial Management: You can buy or sell a 6 1000 par us treasury note that
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