A bond has an annual modified duration of 7.140 and annual convexity of 66.200. The bonds yield-to-maturity
Question:
A bond has an annual modified duration of 7.140 and annual convexity of 66.200. The bond’s yield-to-maturity is expected to increase by 50 basis points. The expected percentage price change is closest to:
A. −3.40%.
B. −3.49%.
C. −3.57%.
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Aun Ali
I am an Associate Member of Cost and Management Accountants of Pakistan with vast experience in the field of accounting and finance, including more than 17 years of teaching experience at university level. I have been teaching at both undergraduate and post graduate levels. My area of specialization is cost and management accounting but I have taught various subjects related to accounting and finance.
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