CFAI printable mock AM Q46

Why does the value for Vuu only equal 103.2 / 1.0621 and not 103.2 / 1.0621 + 3.2

Have seen other questions where this is the case. Value in Year 3 includes a coupon, and in Year 2 you are also receiving a coupon, so why is this not added into the equation for computing Vuu?

Thanks everyone

You should not consider the coupon of time 2 because if you are valuating a bond to buy it(hypothetically) you are missing current year’s coupon (same like not considering Dividends at time 0 in valuation)

Thank you, understand where you are coming from.

However reference the CFAI printable mock PM Q45 they have included the final year coupon at Year 2, but not at time 0

Conversely the CFAI printable mock AM Q46 we were discussions above goes the other way around, no final year coupon, but coupon at time 0 included… why is this the case?

Thanks in advance :slight_smile: