Question: 16-8 (answer all on the list in the question) A 30 -year maturity bond making annual coupon payments with a coupon rate of 9.5% has

16-8 (answer all on the list in the question)

16-8 (answer all on the list in the question) A 30 -year

A 30 -year maturity bond making annual coupon payments with a coupon rate of 9.5% has duration of 13.53 years and convexity of 258.03. The bond currently sells at a yleld to maturity of 6%. a. Find the price of the bond If Its yleld to maturity falls to 5%. b. What price would be predicted by the duration rule? c. What price would be predicted by the duration-with-convexity rule? d-1. What is the percent error for each rule? d-2. What do you conclude about the accuracy of the two rules? e-1. Find the price of the bond If its yleld to maturity Increases to 7%. e-2. What price would be predicted by the duration rule? e-3. What price would be predicted by the duration-wlth-convexity rule? e-4. What is the percent error for each rule? e-5. Are your conclusions about the accuracy of the two rules consistent with parts (a) (d) ? Complete this question by entering your answers in the tabs below. Find the price of the bond if its yield to maturity falls to 5%. (Do not round intermediate calculations. Round your answer to 2 decimal places.) A 30 -year maturity bond making annual coupon payments with a coupon rate of 9.5% has duration of 13.53 years and convexity of 258.03. The bond currently sells at a yleld to maturity of 6%. a. Find the price of the bond If Its yleld to maturity falls to 5%. b. What price would be predicted by the duration rule? c. What price would be predicted by the duration-with-convexity rule? d-1. What is the percent error for each rule? d-2. What do you conclude about the accuracy of the two rules? e-1. Find the price of the bond If its yleld to maturity Increases to 7%. e-2. What price would be predicted by the duration rule? e-3. What price would be predicted by the duration-wlth-convexity rule? e-4. What is the percent error for each rule? e-5. Are your conclusions about the accuracy of the two rules consistent with parts (a) (d) ? Complete this question by entering your answers in the tabs below. Find the price of the bond if its yield to maturity falls to 5%. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

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