a. 1. You have purchased a bond with 4 years to maturity (face value $1,000), paying a coupon rate of 6.5% (paid annually), trading at a yield to maturity of 7.4%. What is the price of the bond? b. What is the bond's Macaulay duration? You expect that interest rates will fall by 0.3%. Use the modified duration to find the approximate percentage change in the price of the bond. d. What is the actual new price of the bond at its new yield-to-maturity? (using the regular present-value calculations) Why are your answers different? Explain and illustrate graphically. C