Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Compute the duration of a 30 year 9% bond if yields to maturity are 6% presently. If rates drop by 1%, how much will the

Compute the duration of a 30 year 9% bond if yields to maturity are 6% presently. If rates drop by 1%, how much will the price change? What if rates dropped by 2%? Which is more accurate? Why? Ascertain that you compute both the exact price and the approximate price by using duration.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Technical Analysis Of Stock Trends

Authors: Robert D. Edwards, John Magee , W.H.C. Bassetti

11th Edition

1138069418,1351631438

More Books

Students also viewed these Finance questions