A 10-year, 10 percent annual coupon, $1,000 bond trades at a yield to maturity of 8 percent.

Question:

A 10-year, 10 percent annual coupon, $1,000 bond trades at a yield to of 8 percent. The bond has a duration of 6.994 years. What is the modified duration of this bond? What is the practical value of calculating modified duration? Does modified duration change the result of using the duration relationship to estimate price sensitivity?
Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...