7 The clean price of a bond is a The price excluding the bro

7. The \'clean price\' of a bond is:
a. The price excluding the broker\'s commission
b. The price excluding accrued interest
c. The price net of tax
d. The price when it is first issued
e. Also known as the “dirty price”

Solution

Answer: b)the price excluding accrued interest

Explanation:

the clean price is the price of a bond excluding any interest that has accrued since issue or the most recent coupon payment. This is to be compared with the dirty price, which is the price of a bondincluding the accrued interest