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2. Convexity: A newly issued bond has a maturity of 10 years and pays a 7% coupon rate (with coupon payments coming once annually). The

2. Convexity: A newly issued bond has a maturity of 10 years and pays a 7% coupon rate (with coupon payments coming once annually). The bond sells at par value of S100 (a) What are the duration, modified duration and dollar duration of the bond? What is its convexity? (b) Find the actual price of the bond assuming that its yield to maturity immediately increases from 7% to 8% after issuance

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