SIE practice questionhardAccrued Interest
A 6% corporate bond makes interest payments on Feb 1 and Aug 1. If a customer buys the bond on May 10, how much accrued interest do they pay the seller (assuming 30/360 basis)?
- A3 months and 10 days
- B3 months and 9 days✓ Correct answer
- C3 months and 8 days
- D3 months and 11 days
Explanation
Why B — 3 months and 9 days
From Feb 1 to May 10 is 3 full months (Feb, Mar, Apr) + 9 days (May 1–9). Calculation is prior to settlement date, not trade date.
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