Question: Potential change in interest rate: 0.153 Using continuous compounding interest rate, A) compute the price for this bond. B) compute the duration for this bond.

Potential change in interest rate: 0.153 Using continuous compounding interest rate,

Potential change in interest rate: 0.153

Using continuous compounding interest rate,

A) compute the price for this bond.

B) compute the duration for this bond.

C) compute the convexity for this bond.

D) estimate the change in this bond's price using both Duration and Convexity.

NOTE: PLEASE SHOW WORK AND EXPLAIN WHEN USING EXCEL OR WORD.

Bond A has the following information: Face value: RM1,000 Coupon rate: 10% Yield to maturity: 7% Time to maturity: 10 The potential change in interest rate next year is given in the TABLE 3 below. Bond A has the following information: Face value: RM1,000 Coupon rate: 10% Yield to maturity: 7% Time to maturity: 10 The potential change in interest rate next year is given in the TABLE 3 below

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