To finance a new Fab in Arizona, TSM issued an 8-year, 5.75% coupon bond with semi-annual...
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To finance a new Fab in Arizona, TSM issued an 8-year, 5.75% coupon bond with semi-annual coupon payments. The current YTM is 6.5%. What is the duration of this bond and how much will the price change if YTM goes up by 1% using the duration approximation method you've learned in this class? To finance a new Fab in Arizona, TSM issued an 8-year, 5.75% coupon bond with semi-annual coupon payments. The current YTM is 6.5%. What is the duration of this bond and how much will the price change if YTM goes up by 1% using the duration approximation method you've learned in this class?
Expert Answer:
Answer rating: 100% (QA)
To calculate the duration of a bond we need to use the formula Duration 1 YTM1 C11 YTM C21 YTM2 Cn1 ... View the full answer
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-1260153590
12th edition
Authors: Stephen M. Ross, Randolph W Westerfield, Robert R. Dockson, Bradford D Jordan
Posted Date:
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