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A 5-year, 8.5% annual-compounding bond priced to yield 10%. a. Calculate the Macaulay duration of the bond. b. Calculate the bond price. c. Calculate the

A 5-year, 8.5% annual-compounding bond priced to yield 10%.

a. Calculate the Macaulay duration of the bond.

b. Calculate the bond price.

c. Calculate the modified duration of the bond.

d. According the modified duration, what is the estimated bond price if the market yields decline to 9%?

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