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Assume a $1,000 5% coupon bond with three years to maturity and market interest rates are 7%. a. Calculate the duration (5pts) b. Calculate the

Assume a $1,000 5% coupon bond with three years to maturity and market interest rates are 7%. a. Calculate the duration (5pts) b. Calculate the expected price change if in terest rates drop to 6.75% using the duration approximation. ( MCQ

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