a. An investor buys a 4.4% annual coupon payment bond with six years to maturity. The bond

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a. An investor buys a 4.4% annual coupon payment bond with six years to maturity. The bond has a yield-to-maturity of 6%. The par value is $1000.

i. Determine the market price of the bond.

ii. Calculate the bond’s duration and modified duration.

iii. If the YTM decreases to 5.5%, what is the predicted dollar change in price using the duration concept?

Related Book For answer-question

Investments An Introduction

ISBN: 978-0324561388

9th Edition

Authors: Herbert B Mayo

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Posted Date: Nov 09, 2020 10:01 AM

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a. An investor buys a 4.4% annual coupon payment bond with six years to maturity. The bond

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Investments An Introduction

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