Question: 2 . A bond with $ 1 , 0 0 0 face value, 1 0 % coupon, market interest rates of % 1 5 ,

2. A bond with $1,000 face value, 10% coupon, market interest rates of %15, and 10 years to maturity.
a. Calculate the duration of the bond. Show calculation.
b. Assume that market interest rates decreased to 5%, re-calculate the duration of the bond
c. Comment generally on the relationships between the interest rates, coupons, and duration

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