Question

An insurance company is analyzing the following three bonds, each with five years to maturity, and is using duration as its measure of interest rate risk:
a. $ 10,000 par value, coupon rate = 8%, rb = 0.10
b. $ 10,000 par value, coupon rate = 10%, rb = 0.10
c. $ 10,000 par value, coupon rate = 12%, rb = 0.10 What is the duration of each of the three bonds?



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  • CreatedJanuary 27, 2015
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