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3. Suppose there is a 10-year bond with annual coupon rate 3%. Its yield to maturity is 5% and it has a duration of 8
3. Suppose there is a 10-year bond with annual coupon rate 3%. Its yield to maturity is 5% and it has a duration of 8 years. (a) Find the bond's modified duration (b) Suppose the yield to maturity changes from 5% to 6%, what is the percentage change of the bond price? (c) Suppose the coupon rate changes from 3% to 2%, will the modified duration increase
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