Question: Part A,D and E 12. Calculate the requested measures for bonds A and B (assume each bond pays interest semi- annually): B Coupon Yield to

Part A,D and E

Part A,D and E 12. Calculate the requested measures for bonds A

12. Calculate the requested measures for bonds A and B (assume each bond pays interest semi- annually): B Coupon Yield to maturity Maturity (in years) Par Price A 8% 8% 2 100.00 100.000 9% 8% 5 100.00 104.055 a. Calculate the duration for the two bonds by changing the yield up and down 25 basis points. b. Calculate the duration for the two bonds by changing the yield up and down by 10 basis points. c. Compare your answers to parts (a) and (b). d. Calculate the Macaulay duration for the two bonds. e. Calculate the modified duration for the two bonds. f. Compare the modified duration for the two bonds computed in parts (e) and (a). 13 Forband

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