Question
Calculate the duration of a 2-year, $1,000 bond that pays an annual coupon of 10 percent and trades at a yield of 14 percent. What
Calculate the duration of a 2-year, $1,000 bond that pays an annual coupon of 10 percent
and trades at a yield of 14 percent. What is the expected change in the price of the bond if
interest rates decline by 0.50 percent (50 basis points)?
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Financial Institutions Management A Risk Management Approach
Authors: Marcia Cornett, Patricia McGraw, Anthony Saunders
8th edition
978-0078034800, 78034809, 978-0071051590
