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Face Value =1.0005; Annual coupons =805; Annual Interest rate =6% 1. Compute the PV of the bond? 2. What will happen to the bond price
Face Value =1.0005; Annual coupons =805; Annual Interest rate =6% 1. Compute the PV of the bond? 2. What will happen to the bond price if the interest rate increases to 6% ? 3. Compute both the duration and the modified duration of the bond? 4. Interpret your results in question 3
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