Answer:
The dollar price you expect to pay is $1041.25
Explanation:
Given
Asking Price = 104:08
Bidding Price = 104:04
The bid price of the dealer is calculated as:
104 + 04/(04 * 08) %
= 104 + 4/32 %
= 104 + 0.125 %
= 104.125%
= 1.04125
Assume that $1,000 represents a unit bond;
The bid price of the dealer is finally calculated as:
1.04125 of $1,000
= $1041.25
Hence, the dollar price you expect to pay is $1041.25
Answer:The price expected to pay $1,041.25
Explanation:
Ask price = 104:08
Bid price = 104:04
The bid price of the dealer received = 104 4/32 = 0.125
= 104.125%
Since bond is usually in $1000 denomination
104.125% × 1000
= 1041.25
=1,041.25
Therefore the dollar price expected to pay = $1,041.25
