Q11.3 Briefly explain what will happen to a bonds duration measure if each of the following events

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Q11.3 Briefly explain what will happen to a bond’s duration measure if each of the following events occur.

a. The yield-to-maturity on the bond falls from 8.5% to 8%.

b. The bond gets one year closer to its maturity.

c. Market interest rates go from 8% to 9%.

d. The bond’s modified duration falls by half a year.

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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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