A newly issued International annual-pay coupon bond has the following characteristics: Trading at par (100 CHF)....

 

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A newly issued International annual-pay coupon bond has the following characteristics: Trading at par (100 CHF). Time to maturity of 15 years Coupon rate of 9.5% Based on an 85-basis-point increase and decrease in yield: a). Compute the bond's Effective or Modified Duration (10% Marks) b). If Convexity is 56.75 and the Current price of Bond is CHF 93.66, Compute the new price of the Bond for the 85-basis points increase in Yield of the Bond (10% Marks) 5. Total marks 20% The day after Dhruv Yadav purchased CHF 100,000 par value (The initial face or par value is CHF 1'000) of a 6-year A-rated International corporate bond with a 7% semi- annual coupon, at a yield to maturity of 6.5%, it was downgraded and its yield to maturity increased to 7.5%. T What was percentage decrease in the value or price of Dhruv's bond closest to (YOU MUST SHOW COMPUTATIONS): A. 4.5%. B. 4.7%. C. 4.9%. A newly issued International annual-pay coupon bond has the following characteristics: Trading at par (100 CHF). Time to maturity of 15 years Coupon rate of 9.5% Based on an 85-basis-point increase and decrease in yield: a). Compute the bond's Effective or Modified Duration (10% Marks) b). If Convexity is 56.75 and the Current price of Bond is CHF 93.66, Compute the new price of the Bond for the 85-basis points increase in Yield of the Bond (10% Marks) 5. Total marks 20% The day after Dhruv Yadav purchased CHF 100,000 par value (The initial face or par value is CHF 1'000) of a 6-year A-rated International corporate bond with a 7% semi- annual coupon, at a yield to maturity of 6.5%, it was downgraded and its yield to maturity increased to 7.5%. T What was percentage decrease in the value or price of Dhruv's bond closest to (YOU MUST SHOW COMPUTATIONS): A. 4.5%. B. 4.7%. C. 4.9%.