Question
A 5-year, $1,000 face bond with a 3% coupon is currently selling with a 4% YTM (yield to maturity). Purchase price of the bond: $955.48
A 5-year, $1,000 face bond with a 3% coupon is currently selling with a 4% YTM (yield to maturity). Purchase price of the bond: $955.48
Assume that market yields rise by 40 basis points. What do you expect to happen to the bonds price, using modified duration? $17.31, $45.12, 28.99, $36.75
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Financial Markets And Institutions
Authors: Frederic S. Mishkin, Stanley Eakins
6th International Edition
0321552113, 9780321552112
