Question: In your response be sure to write the formula with numbers. Simply writing the answer will not get you credit. 1 . Compute the price

In your response be sure to write the formula with numbers. Simply writing the answer will not get you credit.
1. Compute the price of a 10 year zero coupon bond with face value $100. Assume that the annual yield to maturity on the bond is 10%.(show the formula)
2. Compute the price of the bond if yields increase to 10.01%?
3. Using the answers in (1) and (2), compute the DV01 and modified duration of the bond.
4. If interest rates increase by 0.5%, what is the approximate % change in the price of the bond based on your answer in Q3 above?

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