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Curve drawing! Using Exhibit 1, draw the YTM curve for bond A, B, and C in one graph for both at the time of purchase
Curve drawing!
Using Exhibit 1, draw the YTM curve for bond A, B, and C in one graph for both at the time of purchase and at current price. Show graphically that the yield curve has steepened (either hand draw or excel).
Exhibit 1 Berendsen Fixed-Income Portfolio Characteristics Bond A Bond B Bond c 4.45% 0.50% 15-Feb-2021 9.00% 15-Aug-2023 15-Feb-2027 Coupon rate Maturity date YTM at time of purchase YTM at current price Market value 2.95% 4.72% 4.97% 1.85% 5.07% 4.70% USD930,720 USD732,412 USD986,100 Allocation 28% 35% 37% Macaulay duration 1.49 3.48 6.43 Note 1: Interest earned on cash: 1.00% Note 2: Portfolio cash flow yield: 4.15%Step by Step Solution
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