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A 30-year maturity bond making annual coupon payments with a coupon rate of 15.5% has duration of 9.96 years. The bond currently sells at

 

A 30-year maturity bond making annual coupon payments with a coupon rate of 15.5% has duration of 9.96 years. The bond currently sells at a yield to maturity of 10%. Required: a. Find the current price of the bond. b. Find the price of the bond if its yield to maturity falls to 9%. c. What price would be predicted by the duration rule, if its yield to maturity falls to 9%? d. Find the price of the bond if it's yield to maturity rises to 11%. e. What price would be predicted by the duration rule, if it's yield to maturity rises to 11%?

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