Question: 2 pts D Question 5 A bond's modified duration is 7 years, its current yield-to-maturity is 4.5%, and its price is $950. Approximately what will

2 pts D Question 5 A bond's modified duration is 7

2 pts D Question 5 A bond's modified duration is 7 years, its current yield-to-maturity is 4.5%, and its price is $950. Approximately what will be the price of the bond if the yield-to-maturity increases to 4.6%? O879.4 883.5 941.5 943.4 ONot enough information

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

A bicycle manufacturer currently produces 298,000 units a year and expects output levels to remain steady in the future. It buys chains from an outside supplier at a price of $2.10 a chain. The plant...

Which of the following has caused banks difficulty in estimating liquidity needs? A. competition for loans from other financial institutions B. deregulation of interest rate ceilings on deposits C....

Detailed Explanation for Question 32 to 36 For question 32, how to get contract multiplier of 500? For question 36, why the change in the portfolio yield is 0.01%, and how to get $82.8? 21 Student:...

my question is why question 34's solution shows that a contract multiplier is $500? for questions 35 is why the change in yields is 0.01%. for question 36, how to get 82.8? why the change in yield is...

Assume it is January 1, 2024. Shubha is managing her financial portfolio and calculates that her liabilities - including credit card payments, student loans, and car payments - have a modified...

IN ALL OF THE FOLLOWING QUESTIONS ASSUME THE PAR VALUE OF THE BOND IS $100 COUPON RATES ARE QUOTED ANNUALLY BUT ARE GIVEN SEMI-ANNUALLY DISCOUNT RATES ARE QUOTED ANNUALLY BUT ARE COMPOUNDED...

can you answer the following questions Bond A Bond B 6% 7% Coupon Yield to maturity 6% 6% Maturity (years) 2 5 Par $100.00 $100.00 Price $100.00 $ 104,265 Compute the convexity measure for both bonds...

Consider the following investment strategies: a. Buying and holding an n-year zero-coupon bond b. Buying an (n-1)-year zero-coupon bond and rolling over the proceeds into a 1. year bond Under...

QUESTION 31 If you hold a $15m bond portfolio with modified duration of 7 years. You expected the market interest rate increase by 10 basis points (0.10%), whats the PVBP(price value of a basis...

Question 5 3 pts The modified duration of a bond is 2.5 years and convexity is 9. The bond is currently trading at a price of $100. Based on modified duration and convexity, what should be the new...

a fixed coupon bond with 20 years to maturity has a coupon rate of 8.5%, with payments made annually. what is the price the company would expect to see for this bond if it expects the yield to be 9%?...

Woodland Farm Corporation has the following items to include in its financial statements: None of the listed amounts includes any income tax effects. The companys tax rate is 35 percent. REQUIRED: a....

Two packing boxes whose masses are 10.0 kg and 5.00 kg are connected by a light rope that passes over a frictionless pulley as in the figure. The 5.00 kg box is on a smooth surface inclined at an...

A stock has had the following year - end prices and dividends: YearPriceDividend 1 $ 6 4 . 8 3 2 7 1 . 7 0 $ . 7 0 3 7 7 . 5 0 . 7 5 4 6 3 . 7 7 . 8 1 5 7 4 . 1 1 . 9 0 6 8 4 . 7 5 . 9 7 What are the...

Hunting is what kind of Industry? A . Intellectual B . Interpretation C . Extractive D . Economic