Question: There is a 10%, 13 year note bond which has a ytm of 9%. The ytm alters by half a percent down. By how much

  1. There is a 10%, 13 year note bond which has a ytm of 9%. The ytm alters by half a percent down. By how much does the price alter? If the ytm drops by 3%, by how much does the price change?

What is the exact percentage change of the bond in the 2 cases?

  1. There is a par 30 year, 6% bond. What is the % alteration, if the ytm alters by 2%? Do it with duration alone. Then, find the change, if you include convexity also. The convexity is 40.

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