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A coupon Bond has the following characteristics: Face-Value: $5000 Time to Maturity: 20 years Coupon Rate: 4% Current price: $6000 Coupons are paid semi-annually What

A coupon Bond has the following characteristics: Face-Value: $5000 Time to Maturity: 20 years Coupon Rate: 4% Current price: $6000 Coupons are paid semi-annually What is the yield of the bond? What is the duration of the bond in years? (warning: if you get duration in terms of 6-month periods, you have to convert 6-month periods to years) Based on the duration of the bond, what would you estimate its new price would be if the yield on the bond immediately decreased by 0.5%? What is the actual new price of the bond if the yield decreased by 0.5%? What is the new duration of the bond if the yield decreased by 0.5%?

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