Considers the sensitivity of a bond's price (convexity) and duration to term-to-maturity and yield-to-maturity.

Settlement date	Maturity date	Coupon	Yield to Maturity	Frequency	Basis	Redemption	Duration	Price
15-Jun-17	15-Jun-20	0.0150	0.0148	2	0	100	2.94	100.06
15-Jun-17	15-Jun-20	0.0325	0.0148	2	0	100	2.89	105.18
15-Jun-17	15-Jun-37	0.0350	0.0276	2	0	100	14.88	111.32
15-Jun-17	15-Jun-46	0.0475	0.0301	2	0	100	17.82	133.50

Calculate the price and duration of each bond for yields-to-maturity of 2, 4, 6, 8, and 10%. Report the results in separate tables for each bond.

1. Which bond exhibits the greatest convexity?

2. Which bond has the most volatile price?

3. Which bond's duration is the most sensitive to changes in market yield?

4. The 1.5 and 3.25 coupon bonds have the same time remaining to maturity. Why is the duration of the 1.5s longer than that of the 3.25s?