5a. Find the duration of an 8% coupon bond making annual coupon payments if it has ten years until maturity and a yield to maturity of 6.5%.

5b. You are managing a portfolio of $1.0 million. Your target duration is 18 years, and you can choose from two bonds: a zero-coupon bond with maturity seven years and a perpetuity, each currently yielding 3.5%. What portion of your portfolio should be the zero-coupon bond and what portion should be the perpetuity?

5c. Find the convexity of a seven-year maturity, 5.56% coupon bond selling at a yield to maturity of 6.2%. The bond pays its coupons annually.

5a. Find the duration of an 8% coupon bond making annual coupon payments if it has ten years until maturity and a yield to maturity of 6.5%. 5b. You are managing a portfolio of $1.0 million. Your target duration is 18 years, and you can choose from two bonds: a zero-coupon bond with maturity seven years and a perpetuity, each currently yielding 3.5%. What portion of your portfolio should be the zero-coupon bond and what portion should be the perpetuity? 5c. Find the convexity of a seven-year maturity, 5.56% coupon bond selling at a yield to maturity of 6.2%. The bond pays its coupons annually