Question
A bond with a 2-year maturity has a coupon rate of 10% and a face value of $1,000. The coupons are paid annually and the
A bond with a 2-year maturity has a coupon rate of 10% and a face value of $1,000. The coupons are paid annually and the next coupon is due in one year. The bond's yield to maturity is 10%. What is this bond's Modified Duration?
Step by Step Solution
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Step: 1
To calculate the modified duration of the bond we need to use the formula for modifie...
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
13th edition
1439078106, 111197375X, 9781439078105, 9781111973759, 978-1439078099
