A bond currently has a price of $1,050. The yield on the bond is 6%. The bond has a modified duration (D*) of 7.78. If the yield increases 27

basis points (or 0.27%), the prediced new price using Duration Rule is

Round up to the next dollar

Note: 100 basis points = 1%

O $1.028

O $1,294

O $1,140

O $1 065