A bond portfolio consists of the following three fixed-rate bonds. Assume annual coupon payments and no accrued
Question:
A bond portfolio consists of the following three fixed-rate bonds. Assume annual coupon payments and no accrued interest on the bonds. Prices are per 100 of par value.
The bond portfolio’s modified duration is closest to:
A. 7.62.
B. 8.08.
C. 8.20.
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Step by Step Answer:
To calculate the bond portfolios modified durationwe need to first calculate the market valueweighte...View the full answer
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