Question: Answered in excel with formulas please 9.7 A five-year bond with a yield of 11% (continuously compounded) pays an 8% coupon at the end of

Answered in excel with formulas please 9.7 A five-year bond with

Answered in excel with formulas please

9.7 A five-year bond with a yield of 11% (continuously compounded) pays an 8% coupon at the end of each year. (a) What is the bond's price? (b) What is the bond's duration? What is the bond's duration? (c) Use the duration to calculate the effect on the bond's price of a 0.2% decrease in its yield. (d) Recalculate the bond's price on the basis of a 10.8% per annum yield and verify that the result is in agreement with your answer to (c). (e) Answer questions (a)(d) again on the assumption that the yield is compounded annually. 9.7 A five-year bond with a yield of 11% (continuously compounded) pays an 8% coupon at the end of each year. (a) What is the bond's price? (b) What is the bond's duration? What is the bond's duration? (c) Use the duration to calculate the effect on the bond's price of a 0.2% decrease in its yield. (d) Recalculate the bond's price on the basis of a 10.8% per annum yield and verify that the result is in agreement with your answer to (c). (e) Answer questions (a)(d) again on the assumption that the yield is compounded annually

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