Question: A bond with a 9 - year duration is worth $ 1 0 8 . 0 0 and its yield to maturity is 8 %

A bond with a 9-year duration is worth $108.00 and its yield to maturity is 8%. If the yield to maturity falls to 7.84%, you would predict that the new value of the bond will be $_____.($109.56 was not the correct answer)

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!

Q:

A bond with a 9 -year duration is worth $108.00 and its yield to maturity is 8%. If the yield to maturity falls to 7.84% you would predict that the new value of the bond will be 5 1,094.4

Q:

A bond with an 8 -year duration is worth $1,065, and its yield to maturity is 5.26%. If the yield to maturity falls to 5.044 you would predict th bond will be approximately (Answer rounded to two...

Q:

A bond with a 8 year duration is worth $1077 and its yield to maturity is 77% If the yield to maturity falls to 757 you would predict that the new value of the bond will be approximately Multiple...

Q:

A bond with a 9-year modified duration is worth $1,080, and its yield to maturity is 8%. If the yield to maturity falls to 7.84%, you would predict that the new value of the bond will be...

Q:

A bond with a 9-year MODIFIED duration is worth $1,080, and its yield to maturity is 8%. If the yield to maturity falls to 7.84%, you would predict that the new value of the bond will be...

Q:

Bond A-D Page of 7 0 You are an investor who possesses a single liability - one cash flow of $185.80 to be paid in 8 years. To fund these liabilities, you have purchased a bond with a duration of 7...

Q:

its the last three pictures. ignore the first three Formulas Data Heviow View Page Layout Home Insert General Cut Wrap Text A A 10 Arial Copy % Condit Merge & Center 00 I U Paste Format Format H19 J...

Q:

Clifford Clark is a recent retiree who is interested in investing some of his savings in corporate bonds. His financial planner has suggested the following bonds: Bond A has a 14% annual coupon,...

Q:

They leveraged portfolio return is PRACTICE PROBLEM: Ccile Perreaux is a junior analyst for an international wealth management firm. Her supervis, The following information relates to Questions 1-6...

Q:

a. What effect would each of the following events likely have on the level of nominal interest rates? 1. Households dramatically decrease their savings rate. This action will decrease the supply of...

Q:

The confirmation process is defined as the process of obtaining and evaluating a direct communication from a third party in response to a request for information about a particular item affecting...

Q:

Which of the following is not a valid elementary row operation to perform on an augmented matrix using the Gauss Elimination method? Interchange/reorder rows Multiply or divide a multiple of one row...

Q:

3.27 The following is a set of data from a sample of n = 9: 4 9 1 6 4 2 4 8 9 a. Compute the first quartile (Q1), the third quartile (Q3), and the interquartile range. b. List the five-number...

Q:

How can a firm encourage independent companies to produce complements for new technology standards? provide software tools to make development easier establish in - house production centers first...

Q:

=+. Alliteration The Magic of Macy's tagline.

Q:

=+vi. ABA last line of copy reiterates the headline, for example, if the headline were In an Absolut World, the last line could say, Now you can help create an Absolut world.

Q:

=+iv. Simple promise No ordinary airline (Virgin Atlantic Airway).