Consider the duration of a bond to be 5 years, and it is selling at par...
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Consider the duration of a bond to be 5 years, and it is selling at par for $1,678. This bond has an annual coupon rate of 8%. If interest rates increase by 20 basis points, what is the approximate change in the market price using the duration approximation? (Round your answer to the nearest 3 decimal places.) Enter your answer in the box below. An FI purchases at par value a $407,315 Treasury bond paying 10 percent interest with a 7.5 year duration. If interest rates rise by 4 percent, calculate the bond's new value. Recall that Treasury bonds pay interest semiannually. Use the duration valuation equation. Enter your answer in the box below. Round your answer to 3 decimal places. Consider the duration of a bond to be 5 years, and it is selling at par for $1,678. This bond has an annual coupon rate of 8%. If interest rates increase by 20 basis points, what is the approximate change in the market price using the duration approximation? (Round your answer to the nearest 3 decimal places.) Enter your answer in the box below. An FI purchases at par value a $407,315 Treasury bond paying 10 percent interest with a 7.5 year duration. If interest rates rise by 4 percent, calculate the bond's new value. Recall that Treasury bonds pay interest semiannually. Use the duration valuation equation. Enter your answer in the box below. Round your answer to 3 decimal places.
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Related Book For
Financial Institutions Management A Risk Management Approach
ISBN: 978-0071051590
8th edition
Authors: Marcia Cornett, Patricia McGraw, Anthony Saunders
Posted Date:
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