Consider the cash flows on a four-year bond with a 5% coupon rate and $100 par value: Time (years from now) 1 2 3 4 Cash flows 5 5 5 105 The bond's yield to maturity is 3%. (i) Compute the bond's duration (in years) (15 points) The next two questions assume you have invested $100 million (in market value) in the four-year bond listed above. (ii) Using duration, compute by how much the value of your bond investment changes if the bond's yield to maturity decreases from 3% to 2%. Include a minus' sign if the change is negative. (10 points) (iii) Compute the duration of a 100-year bond with a 2% coupon rate that pays coupons once per year. The bond's yield to maturity is 3% per year. Duration of 100-year bond (20 points)