Calculate the duration of a two-year, $1,000 bond that pays an annual coupon of 10 percent and

Question:

Calculate the duration of a two-year, $1,000 bond that pays an annual of 10 percent and trades at a yield of 14 percent. What is the expected change in the price of the bond if interest rates fall by 0.50 percent (50 basis points)? Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...