Question: A portfolio includes two bonds, A and B. Bond A has a principal of $2,000 and Bond B has a principal of $2,000. The market

A portfolio includes two bonds, A and B. Bond A has a principal of $2,000 and Bond B has a principal of $2,000. The market values are $2,500 for Bond A and $1,500 for Bond B. Durations are 3 years for Bond A and 5 years for Bond B. Convexities are 10 for Bond A and 20 for Bond B. What are the duration and convexity of the portfolio?

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