Find the duration of a bond with settlement date May 27, 2018, and maturity date November 15,
Question:
Find the duration of a bond with settlement date May 27, 2018, and maturity date November 15, 2027. The coupon rate of the bond is 7%, and the bond pays coupons semiannually. The bond is selling at a yield to maturity of 8%. You can use Spreadsheet 11.2, available in Connect; link to Chapter 11 material.
Spreadsheet 11.2
Transcribed Image Text:
A 1 Inputs 2 Settlement date 3 Maturity date 4 Coupon rate 5 Yield to maturity 6 Coupons per year 7 8 Outputs 9 Macaulay duration 10 Modified duration B Formula In column B 1/1/2000-DATE(2000,1,1) 1/1/2003 DATE(2003,1,1) 0.08 0.08 0.10 0.10 1 1 2.7774 2.5249 DURATION(B2,B3,B4,B5,B6) MDURATION/B2.83.84.85.86)
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 33% (3 reviews)
To find the duration of a bondwe can use the following formula Duration Present Value of Cash Flow T...View the full answer
Answered By
Nicholas Maina
Throughout my tutoring journey, I've amassed a wealth of hands-on experience and honed a diverse set of skills that enable me to guide students towards mastering complex subjects. My proficiency as a tutor rests on several key pillars:
1. Subject Mastery:
With a comprehensive understanding of a wide range of subjects spanning mathematics, science, humanities, and more, I can adeptly explain intricate concepts and break them down into digestible chunks. My proficiency extends to offering real-world applications, ensuring students grasp the practical relevance of their studies.
2. Individualized Guidance:
Recognizing that every student learns differently, I tailor my approach to accommodate various learning styles and paces. Through personalized interactions, I identify a student's strengths and areas for improvement, allowing me to craft targeted lessons that foster a deeper understanding of the material.
3. Problem-Solving Facilitation:
I excel in guiding students through problem-solving processes and encouraging critical thinking and analytical skills. By walking learners through step-by-step solutions and addressing their questions in a coherent manner, I empower them to approach challenges with confidence.
4. Effective Communication:
My tutoring proficiency is founded on clear and concise communication. I have the ability to convey complex ideas in an accessible manner, fostering a strong student-tutor rapport that encourages open dialogue and fruitful discussions.
5. Adaptability and Patience:
Tutoring is a dynamic process, and I have cultivated adaptability and patience to cater to evolving learning needs. I remain patient through difficulties, adjusting my teaching methods as necessary to ensure that students overcome obstacles and achieve their goals.
6. Interactive Learning:
Interactive learning lies at the heart of my approach. By engaging students in discussions, brainstorming sessions, and interactive exercises, I foster a stimulating learning environment that encourages active participation and long-term retention.
7. Continuous Improvement:
My dedication to being an effective tutor is a journey of continuous improvement. I regularly seek feedback and stay updated on educational methodologies, integrating new insights to refine my tutoring techniques and provide an even more enriching learning experience.
In essence, my hands-on experience as a tutor equips me with the tools to facilitate comprehensive understanding, critical thinking, and academic success. I am committed to helping students realize their full potential and fostering a passion for lifelong learning.
4.90+
5+ Reviews
16+ Question Solved
Related Book For
ISE Essentials Of Investments
ISBN: 9781265450090
12th International Edition
Authors: Zvi Bodie, Alex Kane, Alan Marcus
Question Posted:
Students also viewed these Business questions
-
Find the duration of a bond with settlement date May 27, 2016, and maturity date November 15, 2025. The coupon rate of the bond is 7%, and the bond pays coupons semiannually. The bond is selling at a...
-
Find the duration of a bond with a set- exceItlement date of May 27, 2020, and maturity date November 15, 2031. The coupon rate of the bond is 7%, and the bond pays coupons semi-annually. The bond is...
-
Create spreadsheet models to price coupon bonds, compute duration, and examine reinvestment risk. The purpose of this assignment is to get comfortable with basic spreadsheet modeling and to reinforce...
-
Use a histogram to graph the cumulative frequencies. Use the following information to answer question. Suppose a class of high school seniors had the following distribution of SAT scores in English....
-
An analysis of the accounts of Roberts Company reveals the following manufacturing cost data for the month ended June 30, 2014. Costs incurred: raw materials purchases $54,000, direct labor $47,000,...
-
The standard deviation of a foreign asset in local currency is = 8.5 percent, and the standard deviation of the exchange rate is s = 5.5 percent. a. If the correlation between the asset return, in...
-
In the preparation of an analytic flowchart, which of the following symbols should be used when flowlines are broken due to a page limitation? (a) terminal symbol (b) connector symbol (c) manual...
-
Thrifty Co. reported net income of $465,000 for its fiscal year ended January 31, 2011. At the beginning of that fiscal year, 200,000 shares of common stock were outstanding. On October 31, 2010, an...
-
Question 1 Write down the term described below. Q.1.1 Description (Marks: 5) A term used for some businesses that construct distinct websites for each country where they conduct business. Determines...
-
Short-term interest rates are more volatile than long-term rates. Despite this, the rates of return of long-term bonds are more volatile than returns on short-term securities. How can these two...
-
Is the decrease in a bonds price corresponding to an increase in its yield to maturity more or less than the price increase resulting from a decrease in yield of equal magnitude?
-
The pendulum consists of a 10-lb solid ball and 4-lb rod. If it is released from rest when = 0, determine the angle of rebound after the ball strikes the wall and the pendulum swings up to the...
-
Given two zero-coupon bonds with the same face value, one with a time remaining to maturity of 25 years, and the other maturing in 10 years, which one will have a lower market price?
-
1. Describe how energy prices have varied over time and across geographic locations or across commodities. Are energy prices more volatile today than in the past? Is the outlook more or less...
-
Traylor Windows is a small company that installs windows. Its cost structure is asfollows: SELLING PRICE FROM EACH WINDOW INSTALLATION $800 VARIABLE COST OF EACH WINDOW INSTALLATION $700 ANNUAL FIXED...
-
(5%) Problem 3: Cranes use a system of two pulleys to provide mechanical advantage, which reduces the force they need to apply to lift a particular weight (two such possible configurations are shown...
-
You should aim to have 7-10 distinct sources. Remember to ask questions about your sources. Tips Remember to ask questions about your sources . For example: Who is the author? Is there a bias...
-
What is the purpose of classifying mergers by degree of business concentration? Why do you think these classifications have changed over time?
-
Burberrys competitive advantage is through its differentiation strategy. What risk should Burberry remain aware of?
-
Your assistant gives you the following diagram as the efficient frontier of the group of stocks you asked him to analyze. The diagram looks a bit odd, but your assistant insists he double-checked his...
-
What is the relationship of the portfolio standard deviation to the weighted average of the standard deviations of the component assets?
-
The following figure shows plots of monthly rates of return and the stock market for two stocks. a. Which stock is riskier to an investor currently holding her portfolio in a diversified portfolio of...
-
Given that the project is now at the end of 12 weeks based on the data below: ACTIVITY NAME Immediate Predecessor EARLIEST START TIME EXPECTED TIME (t) TOTAL BUDGETED COST ($) PERCENT OF COMPLETION...
-
Identify and describe three different types of long - term debt instruments that businesses use. What are the key features that distinguish one type of debt from another? Why do companies choose to...
-
How do financial statements help healthcare managers assess the financial health of their organization? - What role does financial analysis play in making strategic decisions such as expansions or...
Study smarter with the SolutionInn App