Question: 8. Consider an 11-year zero-coupon bond with a face value of 200. The 11-year spot rate is 3.5% p.a. nominal. Assume that Macaulay Duration and

Consider an 11-year zero-coupon bond with a face value of 200. The 11-year spot rate is 3.5% p.a. nominal. Assume that Macaulay Duration and Modified Duration are expressed as positive numbers. Assuming semi-annual compounding and based on the concept of duration, which statement below is incorrect?

Group of answer choices

The bond has a price of $136.54

The bonds modified duration is 10.81 years.

The bond will decrease in value by 5.41% if the yield curve shifts upwards by 50 basis points at all maturities.

The bond has a Macaulay duration of 11 years.

The bond will increase in value by 738.08 cents if the yield curve shifts downwards by 100 basis points at all maturities.

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