A bond has three years to maturity and a 7 percent yield to maturity (continuously compounded). The bond pays a 9 percent coupon at the end of each year. The par value of the bond is $100.

a) Calculate the bonds price.

b) Compute the bonds duration.

c) Use the duration from (b) to calculate the effect on the bonds price of a 1 percent decrease in its yield. What is the new bonds price?