Question 1 : Consider a coupon bond with an 8% annual coupon rate, a 10% interest rate, and a $1000 face value. The bond will mature in 4 years. What is the duration of this bond? Duration is defined as a weighted average of the maturities of the cash payments. Suppose the weight assigned to the maturity of 1 year is W. Show your work. No work, no credit A: Duration=2.28 and W-7.77% B: Duration=3.56 and W-20.5% C. Duration=3.56 and W-23.1% D. Duration=3.56 and W-7.77%

Question 1 : Consider a coupon bond with an 8% annual coupon rate, a 10% interest rate, and a $1000 face value. The bond will mature in 4 years. What is the duration of this bond? Duration is defined as a weighted average of the maturities of the cash payments. Suppose the weight assigned to the maturity of 1 year is W. Show your work. No work, no credit A: Duration =2.28 and W=7.77% B: Duration =3.56 and W=20.5% C. Duration =3.56 and W=23.1% D. Duration =3.56 and W=7.77%