Question
A certain bond has a 5-year maturity, pays a coupon rate of 7%, and sells for $1,064.80. What is the bond's duration in years assuming
A certain bond has a 5-year maturity, pays a coupon rate of 7%, and sells for $1,064.80. What is the bond's duration in years assuming that coupon payments are made semiannually? Report your answer to two decimal places.
Step by Step Solution
3.42 Rating (161 Votes )
There are 3 Steps involved in it
Step: 1
To calculate the bonds duration we need to take into account the bonds cash flows coupon payments an...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Contemporary Engineering Economics
Authors: Chan S. Park
5th edition
136118488, 978-8120342095, 8120342097, 978-0136118480
