A discount (zero coupon) bond with a principal of 100 has a maturity of 6 years. The

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A discount (zero coupon) bond with a principal of 100 has a maturity of 6 years. The term structure of interest rates is flat with a (continuously compounded) interest rate of 5%. Determine the duration of the bond.

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Posted Date: Jul 12, 2023 02:29 AM

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A discount (zero coupon) bond with a principal of 100 has a maturity of 6 years. The

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SOLUTION The duration of a bond is a measure of the bonds price sensitivity to changes in interest r... View the full answer

Investments

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