[Solved] Assume a 2% increase in the bonds yield.

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Assume a 2% increase in the bonds yield. Calculate the new price using its dvo1 (or, equivalently, its duration). Now calculate the new price using

Assume a 2% increase in the bonds yield. Calculate the new price using its dvo1 (or, equivalently, its duration). Now calculate the new price using the fundamental bond price formula. Why do you think the two answers are not exactly the same?

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