1.) Consider a $100 par value bond that has an 8% coupon rate, pays a semi-annual coupon, matures 2 years from today, and is priced to yield 6%. Calculate the Macauly and modified durations as a present value-weighted average of the time to maturity.

2.) For the bond above, calculate the dollar duration and the price value of a basis point.

3.) For the bond above, estimate the percent and dollar price changes associated with a 0.5% increase in yield.