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Financail Markets: Q1# What is the duration of a five year, $1,000 Treasury bond with a 10 percent coupon (paid semiannually) if its yield to

Financail Markets:

Q1# What is the duration of a five year, $1,000 Treasury bond with a 10 percent coupon (paid semiannually) if its yield to maturity is 12 percent?

Q2# What is the modified duration of the bond in question one?

Q3# Using the modified duration value from question two, what is the predicted price change for the bond if its yield falls to 11 percent?

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