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A bond currently sells for RM920 based on a par value of RM1,000 and promises RM90 in coupon payment for three years before being retired.

A bond currently sells for RM920 based on a par value of RM1,000 and promises RM90 in coupon payment for three years before being retired. Yields to maturity on comparable-quality securities are currently at 12 percent.

i) Calculate the bonds duration

ii) Suppose interest rates in the market fall to 10 percent. Calculate the approximate percent change in the bonds price

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