Suppose a hypothetical CBOT 12-year U.S., semiannual payment, 7% coupon Treasury note futures contract has a quoted price of 103-180. If the note has a $1,000 par value, what is the implied annual interest rate inherent in the futures contract? Do not round your intermediate calculations. ?

A. 6.43%
B. 5.25%
C. 5.12%
D. 6.56%
E. 7.15%


Answer: D

Business

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