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a. An investor buys a 4.4% annual coupon payment bond with six years to maturity. The bond has a yield-to-maturity of 6%. The par value

a. An investor buys a 4.4% annual coupon payment bond with six years to maturity. The bond has a yield-to-maturity of 6%. The par value is $1000.

i. Determine the market price of the bond. (2 marks) ii. Calculate the bonds duration and modified duration. (5 marks)

iii. If the YTM decreases to 5.5%, what is the predicted dollar change in price using the duration concept? (2 marks)

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