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Finding the insurance industry a little dull, you apply for a credit analyst position at a large institutional money manager. After several rounds of interviews,

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Finding the insurance industry a little dull, you apply for a credit analyst position at a large institutional money manager. After several rounds of interviews, you're offered the position. As your first task, the fixed income portfolio manager asks you to analyze a 6-year, AA-rated corporate bond with a 5% coupon rate that is trading for $1,025.92. According to Bloomberg, the bond's yield to maturity (YTM) is 4.75% and its annual duration is 5.3 years. 4. Based on the information provided above, by how much is the bond mispriced in $ terms? In your response, indicate if the bond is overpriced or underpriced

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