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2. A three-year bond with a yield of 12% (continuously compounded) pays a 6% coupon at the end of each year. Principal=100 1) What
2. A three-year bond with a yield of 12% (continuously compounded) pays a 6% coupon at the end of each year. Principal=100 1) What is the bond's duration? 2) Use the duration to calculate the effect on the bond's price of a decrease of 0.3% in its yield.
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Financial Institutions Management A Risk Management Approach
Authors: Marcia Cornett, Patricia McGraw, Anthony Saunders
8th edition
978-0078034800, 78034809, 978-0071051590
