Question: Q)answer the following questions. Topic- fixed income analysis l. a) b) c) Assume a bond has 8% coupon and 10 years to maturity. It pays

l. a) b) c) Assume a bond has 8% coupon and 10

Q)answer the following questions. Topic- fixed income analysis

l. a) b) c) Assume a bond has 8% coupon and 10 years to maturity. It pays coupons semiannually. Its yield to maturity is 6%. Calculate its duration. Calculate its convexity. If interest rate increase to 7%, what is the change in its price: i. Using only duration adjustment Using both duration and convexity adjustment. ii.

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