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A bond with maturity of 5 years, 8% YTM, semi-annual bond has modified duration 3.5. Assuming a holding period of 3 years and an increase

A bond with maturity of 5 years, 8% YTM, semi-annual bond has modified duration 3.5. Assuming a holding period of 3 years and an increase in interest rate to 10% right after the bond is purchased, your HPR would be:

A. Greater than 8%

B. Less than 8%

C. 8%

D. Cannot be determined

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