Question: A RM1000 face-value Bond A has the following information : YTM ( continuous compounding) : 10.0% Coupon rate ( p.a ) : 7.5% Maturity period

A RM1000 face-value Bond A has the following information :

YTM ( continuous compounding) : 10.0%

Coupon rate ( p.a ) : 7.5%

Maturity period ( year) : 29

Expected change in YTM next year : -1%

Reminder: please answer in excel format

a. Compute the price for this bond.

b. Compute the duration for this bond.

c. Estimate the change in this bonds price in the following year and what would be the newly estimated price for this bond.

d. Please interpret what the result means to investors/traders

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