Company ABC has an outstanding bond with a par value of $10,000, a coupon rate of 5% and 5 years remaining to maturity. The bond has a current market price of $9,500. If interest rates were to fall to 4%, what would be the new market price of the bond? Calculate the bond's duration and explain its significance. If the bond's yield to maturity was to increase by 1%, what would be the percentage change in the bond's market price?

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The detailed answer for the above question is provided below The given information is Par Value FV 10000 Coupon Rate 5 Years to Maturity n 5 Current Market Price P 9500 New Yield to Maturity YTM 4 a C... View the full answer