A. What is the duration of a three-year 10% (annual) coupon bond with a par value of

Fantastic news! We've Found the answer you've been seeking!

Question:

A.What is the duration of a three-year 10% (annual) coupon bond with a par value of $1, 000 and a yield to maturity of 7%? Compute your answer correct to two decimal places.

Related Book For answer-question

Essentials of Investments

ISBN: 978-0077835422

10th edition

Authors: Zvi Bodie, Alex Kane, Alan J. Marcus

See More Books

Posted Date: May 11, 2024 02:10 AM

See More Questions

Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4% . You plan to cover this obligation by investing in 5- and20-year maturity Treasury strips.(a)...
You are planning to attend an master level Program that will require payment of $11,000 a year in tuition expenses at the end of each year for 2 years. Bonds currently yield 8.35%. a What is the...
Translate the following C code function into ARM assembly language. int32_t g32(int32_t x) { int32_t f32(int32_t); return xf32(x+9); }
On January 1, 2020, Cullumber Industries Ltd. issued 1,780,000 face value, 5%, 10-year bonds at 1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the...
Why is it important for an international manager to understand the balance of payments?
Algonquin Equipment reported the following items on November 30, 2010 (amounts in thousands, with last years amounts also given as needed): Requirements 1. Compute Algonquin Equipments (a) quick...
The following are typical questions that might appear on an internal control questionnaire for payroll activities: 1. Is there adequate separation of duties between employees who maintain human...
After-Tax Cash Flows: Final Disposal At the end of the life of the project, there are two major sources of cash: (1) release of working capital and (2) preparation, removal, and sale of the equipment...
This question will comprise of three parts. You are asked to first implement a circular linked listLinks to an external site.. Next, you are asked to implement a Naive Distributed Hash Table. This is...
What is the difference between the contestable market model and the cartel model of oligopoly?
Government has provided a way for people to file their tax returns on the Internet to make filing easier and raise compliance. Is this an example of a libertarian paternalistic policy? Explain your...
How are the contestable market model and the cartel model of oligopoly related?
In Taxland, the first $10,000 earned per year is exempt from taxation. Between $10,000.01 and $30,000, the tax rate is 25 percent. Between $30,000.01 and $50,000, its 30 percent. Above $50,000, its...
Is a contestable model or cartel model more likely to judge an industry by performance? Explain your answer.
How product cost information is used by managers?

A. What is the duration of a three-year 10% (annual) coupon bond with a par value of

Question:

Expert Answer:

The duration of a bond measures its price sensitivity to changes in interest rates To calculate the ... View the full answer

Essentials of Investments

Students also viewed these finance questions