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

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Calculate the duration of a two-year, $1,000 bond that pays an annual cou- pon 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 decline by 0.50 percent (50 basis points)?

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Financial Institutions Management A Risk Management Approach

ISBN: 9780073530758

7th Edition

Authors: Anthony Saunders, Marcia Cornett

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Question Posted: Jul 23, 2024 01:00 PM

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

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Financial Institutions Management A Risk Management Approach

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