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(a) Consider a bond with face value $1,000, effective annual coupon rate 5% effective annual yield rate of 7% and duration n years. Such a

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(a) Consider a bond with face value $1,000, effective annual coupon rate 5% effective annual yield rate of 7% and duration n years. Such a bond has Macaulay duration DMac (n) that depends on n. Find lim DMac (n). (b) Consider a bond with face value $1,000, effective annual coupon rate 5% effective annual yield rate of j% and duration 10 years. Such a bond has Macaulay duration DMac (i) that depends N-00 on j. Find lim DMac (i). 000

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