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A 3 year, $1000 par value bond pays a $60 coupon annually. d) How many years of duration is attributable to the terminal year cash

A 3 year, $1000 par value bond pays a $60 coupon annually.

d) How many years of duration is attributable to the terminal year cash flow?

e) What is modified duration?

f) If interest rates increase 25 basis points, what is the dollar change in bond price forecast by modified duration?

g) Computing the new bond price using the new YTM, what is the actual change in the bond price?

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