A Sydney-based fixed-income portfolio manager is considering the following Commonwealth of Australia government bonds traded on the ASX (Australian Stock Exchange): The manager is considering portfolio strategies based upon various interest rate scenarios over the next 12 months. She is considering three long-only government bond portfolio alter-natives, as follows: Bullet: Invest solely in 4.5-year government bonds Barbell: Invest equally in 2-year and 9-year government bonds Equal weights: Invest equally in 2-year, 4.5-year, and 9-year bonds a. Which portfolio has the highest modified duration? b. The manager estimates that accelerated economic growth in Australia will increase the level of government yields-to-maturity by 50 bps. Under this scenario, which of the three portfolios experiences the smallest decline in market value? A Sydney-based fixed-income portfolio manager is considering the following Commonwealth of Australia government bonds traded on the ASX (Australian Stock Exchange): The manager is considering portfolio strategies based upon various interest rate scenarios over the next 12 months. She is considering three long-only government bond portfolio alter-natives, as follows: Bullet: Invest solely in 4.5-year government bonds Barbell: Invest equally in 2-year and 9-year government bonds Equal weights: Invest equally in 2-year, 4.5-year, and 9-year bonds a. Which portfolio has the highest modified duration? b. The manager estimates that accelerated economic growth in Australia will increase the level of government yields-to-maturity by 50 bps. Under this scenario, which of the three portfolios experiences the smallest decline in market value