What is the Duration and Modified duration of a 1,000 face value bond, 2 years to maturity,

Fantastic news! We've Found the answer you've been seeking!

Question:

What is the Duration and Modified duration of a 1,000 face value bond, 2 years to maturity, YTM is 9%, coupon Rate is 9%, and coupon payments are annual?

Related Book For answer-question

Fundamentals of Corporate Finance

ISBN: 978-1260153590

12th edition

Authors: Stephen M. Ross, Randolph W Westerfield, Robert R. Dockson, Bradford D Jordan

See More Books

Posted Date: May 18, 2023 09:05 AM

See More Questions

Create spreadsheet models to price coupon bonds, compute duration, and examine reinvestment risk. The purpose of this assignment is to get comfortable with basic spreadsheet modeling and to reinforce...
Companies often buy bonds to meet a future liability or cash outlay. Such an investment is called a dedicated portfolio because the proceeds of the portfolio are dedicated to the future liability. In...
Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4% . You plan to cover this obligation by investing in 5- and20-year maturity Treasury strips.(a)...
1. The Jarmon Company manufactures and sells a line of exclusive sportswear. Prepare a financial position as at 31st December 2022 from the following information. Account Receivable Long term loan...
The cantilevered beam is made of material having a specific weight . Determine the shear and moment in the beam as a function of x.
Lenses used in eyeglasses, whether converging or diverging, are always designed so that the middle of the lens curves away from the eye, like the center lenses of Figure 36.27a and b. Why?
Review each of the following items, a through $f$, and determine whether the item supports a (1) production view of quality or a (2) customer view of quality. a. Applying management-by-exception...
Past records indicate that the probability of online retail orders that turn out to be fraudulent is 0.08. Suppose that, on a given day, 20 online retail orders are placed. Assume that the number of...
Solve all problems in the Excel file provided Problem 2 You have been asked by the president of the Farr Construction Company to evaluate the proposed acquisition of a new earth mover. The mover's...
Bravo Bags is a luggage retailer that operates out of a shopping mall. As required by the landlord, Bravo Bags has hired Brad Pope, CPA, to provide a report to the landlord as to whether Bravo Bags...
Create a product launch plan for 2 specific markets (the domestic country is the United States and an international country is Japan). Select a new product that has never been marketed as the basis...
Give an example of one piece of financial information that may be used differently for two stakeholders (users) and explain how it would be used and presented differently?
Draw the cross section of n-MOSFET with threshold voltage of 0.5V under the following conditions (Make sure you identify the n-MOSFET operating regions for each cases given below) a. Vos=-0.5V, VDS =...
Singapore switched from the Imputation Tax System to the One Tier Corporate Tax System in 2003. Ignoring the 5-year tax credit grace period, answer the following: Is dividend policy relevant under...
1) How serious was this email security breach? Why did the Kaiser Permanente leadership react so quickly to mitigate the possible damage done by the breach? 2) Assume that you were appointed as the...
Under the no arbitrage condition, when T increases, does the discount factor Z(0,T) necessarily increase or decrease? Why? When T increases, does the yield r(0,T) necessarily increase or decrease?...
Sirius has a luminosity about 23 times that of our Sun, and a radius about 1.8 times that of our Sun. Estimate the temperature of Sirius.
What is the mode?
In the previous problem, suppose you make $5,700 annual deposits into the same retirement account. How large will your account balance be in 30 years? Data from previous problem You are planning to...
An investment project has annual cash inflows of $2,800, $3,700, $5,100, and $4,300, for the next four years, respectively. The discount rate is 11 percent. What is the discounted payback period for...
At 6.1 percent interest, how long does it take to double your money? To quadruple it?
The graph below shows computer links between an official vote-tallying center at vertex 1 and several precincts. For the sake of secrecy, links can be made secure, but since this is an expensive...
Finish the proof of Theorem 1, that is, if $G$ is a connected graph with $n$ vertices and $n-1$ edges, then $G$ is a tree.
Using the work already done in creating the Spanning Tree One Step function, write a full, simplified version of the complete undirected spanning tree algorithm, without the options, which takes the...

What is the Duration and Modified duration of a 1,000 face value bond, 2 years to maturity,

Question:

Expert Answer:

Fundamentals of Corporate Finance

Students also viewed these finance questions