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2) Use the duration to calculate the effect on the bond's price of a decrease of 0.3% in its yield. 3. Consider the following
2) Use the duration to calculate the effect on the bond's price of a decrease of 0.3% in its yield. 3. Consider the following probability distribution for stocks C and D. 1) What's the expected rates of return of stocks C and D? 2) What's the standard deviations of C and D? 3) What's the coefficient of correlation between C and D? State Probability Return on Stock C Return on Stock D 0.30 7% 2 0.50 11% 3 0.20 -16% -9% 14% 26%
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Fundamentals of Futures and Options Markets
Authors: John C. Hull
8th edition
978-1292155036, 1292155035, 132993341, 978-0132993340
