Question: Suppose that there's a callable bond with an effective duration of 3 years and an effective convexity of -2. Use effective duration and convexity as

Suppose that there's a callable bond with an effective duration of 3 years and an effective convexity of -2. Use effective duration and convexity as substitutes for modified versions. All bonds sell at par. What is the second-order percent price sensitivity to a rate change for the callable bond?

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