Question
a.Calculate the duration of a $1,000 7% coupon bond with three years to maturity. Assume that all market interest rates are 6%. Show the computations
a.Calculate the duration of a $1,000 7% coupon bond with three years to maturity. Assume that all market interest rates are 6%. Show the computations in two different ways (Calculator inputs/Discounting by using the formula/Excel spreadsheet). please show the formula
b.Calculate the expected price change if interest rates increase to 6.75% using the duration approximation.please show the formula
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Contemporary Financial Management
Authors: R. Charles Moyer, James R. Mcguigan, William J. Kretlow
9th Edition
032416470X, 9780324164701
