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(a) A 4-year treasury bond was issued on October 1, 2022, with coupon rate of 7.91%. It will be matured on September 30, 2027. On

image text in transcribed (a) A 4-year treasury bond was issued on October 1, 2022, with coupon rate of 7.91%. It will be matured on September 30, 2027. On December 29, 2022, it was trading with a YTM of 7.01%. 1. What is the invoice price of the bond on December 29, 2022? (Marks 2) II. Compute Macaulay and Modified Duration (Marks 4). What will be the effects on bond price if the interest rate increases by 0.50% ? (Mark 1)

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