Question: a) Define the concept 'yield on a bond' and explain the different measures that are important for analysing a bonds performance. b) Define interest rate

a) Define the concept 'yield on a bond' and explain the different measures that are important for analysing a bonds performance. b) Define interest rate risk. Explain the two types of interest rate risk. Explain duration and bond properties and describe how an investor with a given holding period can use duration to reduce interest rate risk.

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