P11.19 A bond has a Macaulay duration of 8.62 and is priced to yield 8%. If interest

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P11.19 A bond has a Macaulay duration of 8.62 and is priced to yield 8%. If interest rates go up so that the yield goes to 8.5%, what will be the percentage change in the price of the bond?

Now, if the yield on this bond goes down to 7.5%, what will be the bond’s percentage change in price? Comment on your findings.

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Fundamentals Of Investing

ISBN: 9781442532885

3rd Edition

Authors: Lawrence J. Gitman, Michael D. Joehnk, Scott Smart, Roger Juchau, Donald Ross, Sue Wright

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Question Posted: Oct 25, 2024 04:00 AM

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P11.19 A bond has a Macaulay duration of 8.62 and is priced to yield 8%. If interest

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Fundamentals Of Investing

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